Tag: bond

Timberland Investment definition explanation

What is Timberland Investment?
An investment instrument used primarily by large institutional investors (such as public and private pension funds). The two main assets that underlie timberland investments are tree farms and managed natural forests. The returns on these forestland investments come from biological growth, upward product class movement, timber price appreciation and land price appreciation. Read more for examples and further explanation including related video clips and also comments
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Equity Derivative definition explanation

What is Equity Derivative?
A derivative instrument with underlying assets based on equity securities. An equity derivative’s value will fluctuate with changes in its underlying asset’s equity, which is usually measured by share price. Read more for examples and further explanation including related video clips and also comments
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Secured Bond definition explanation

What is Secured Bond?
A type of bond that is secured by the issuer’s pledge of a specific asset, which is a form of collateral on the loan. In the event of a default, the bond issuer passes title of the asset or the money that has been set aside onto the bondholders. Secured bonds can also be secured with a revenue stream that comes from the project that the bond issue was used to finance. Read more for examples and further explanation including related video clips and also comments
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Fundamental Analysis definition explanation

What is Fundamental Analysis?
A method of evaluating a security by attempting to measure its intrinsic value by examining related economic, financial and other qualitative and quantitative factors. Fundamental analysts attempt to study everything that can affect the security’s value, including macroeconomic factors (like the overall economy and industry conditions) and individually specific factors (like the financial condition and management of companies).

The end goal of performing fundamental analysis is to produce a value that an investor can compare with the security’s current price in hopes of figuring out what sort of position to take with that security (underpriced = buy, overpriced = sell or short).

This method of security analysis is considered to be the opposite of technical analysis. Read more for examples and further explanation including related video clips and also comments
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Bond Laddering definition explanation

What is Bond Laddering?
A portfolio management strategy and model for investing in fixed income that involves purchasing multiple bonds, each with different maturity dates, in order to achieve the following goals:

– Decrease interest rate risk by holding both short-term and long-term bonds, thereby spreading risk along the interest rate curve. If rates are rising, as one bond matures the funds can be re-invested into higher yield bonds.
– Decrease re-investment risk because as one bond in the ladder matures, the cash is re-invested, but it only represents a portion of the total portfolio. Even if prevailing rates at the time of re-investment are lower than the previous bond was returning, the smaller amount of reinvestment dollars mitigates the risk of investing a lot of cash at a low return.
– Maintain steady cash flows to encourage regular saving for investors looking for an income-producing portfolio. Read more for examples and further explanation including related video clips and also comments
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Blotter definition explanation

What is Blotter?
A record of trades and the details of the trades made over a period of time (usually one trading day). The details of a trade will include such things as the time, price, order size and a specification of whether it was a buy or sell order. The blotter is usually created through a trading software program that records the trades made through a data feed. Read more for examples and further explanation including related video clips and also comments
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