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Call Option
Right to buy shares of a particular stock or stock index at a predetermined price before a preset data, in exchange for a premium.


Call premium

A dollar amount, usually stated as a percent of the principal amount called, paid by the issuer as a "penalty" for the exercise of a call provision.


Callable bonds
Bonds which are redeemable by the issuer prior to the maturity date at a specified price at or above par.


Cap

The top interest rate that can be paid on a floating-rate security.


CAPEX
(capital expenditures)
the funds utilised by a company to purchase durable assets, for example machinery. These are mainly capital account investments that should enable the company to expand or improve its production capacity.

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Capital Asset
Long-term asset that is not bought or sold in the normal course of business.


Capital Gain

Difference between an asset's purchase price and selling price, when the difference is positive.


Capital Markets

Markets where capital funds - debt and equity - are traded.


Capital Stock

Stock authorized by a company's charter. The number and value of issued shares are normally shown, together with the number of shares authorized, in the capital accounts section of the balance sheet.


Capitalization Rate
Rate of interest used to convert a series of future payments into a single present value.


CASH COST
purchases of goods and services and industrial investments.


Cash Cow

A business that generates a continuing flow of cash. Such a business usually has well-established brand names whose familiarity stimulates repeated buying of the products. Stocks that are cash cows have dependable dividends.


Cash Dividend

Cash payment to a corporation's shareholders, distributed from current earnings or accumulated profits.


Cash Equivalents

Instruments or investments of such high liquidity and safety that they are virtually as good as cash. Examples are Money Market Funds and Treasury Bills.


Closed-End Fund

Type of fund that has a fixed number of shares usually listed on a major stock exchange. Unlike open-end funds, closed-end funds do not stand ready to issue or redeem shares on a continuous basis.


Closed-end investment company

An investment company created with a fixed number of shares which are then traded as listed securities on a stock exchange. After the initial offering, existing shares can only be bought from existing shareholders.


Collar

Upper and lower limits (cap and floor, respectively) on the interest rate of a floating-rate security.


Common Stock

Units of ownership of a public corporation. Owners typically are entitled to vote on the selection of directors and other important matters as well as to receive dividends on their holdings.


Consolidated Financial Statement

Financial statement that brings together all assets, liabilities, and operating accounts of a parent company and its subsidiaries.


Controlling Interest

Ownership of more than 50% of a corporation's voting shares. A much smaller interest, owned individually or by a group in combination, can be controlling if the other shares are widely dispersed and not actively voted.


Convertibles
Corporate securities (usually preferred shares or bonds) that are exchangeable for a set number of another form (usually common shares) at a prestated price.


Corporation
A legal entity, separate and distinct from the persons who own it. It has three chief distinguishing features: limited liability (owners can lose only what they invest); easy transfer of ownership through the sale of shares; and continuity of existence.


Cost of Capital

Rate of return that a business could earn if it chose another investment with equivalent risk - in other words, the opportunity cost of the funds employed as the result of an investment decision. Cost of capital is also calculated using a weighted average


Countercyclical Stocks

Stocks that tend to rise in value when the economy is turning down or is in recession.


Coupon
This part of a bearer bond denotes the amount of interest due, and on what date and where payment will be made. Bearer coupons are presented to the issuer's designated paying agent for collection. With registered bonds, physical coupons don't exist.


Current Ratio

Current assets divided by current liabilities. The ratio shows a company's ability to pay its current obligations from current assets.


Current yield

The ratio of interest to the actual market price of the bond, stated as a percentage. For example, a bond with a current market price of $1,000 that pays $80 per year in interest would have a current yield of 8%.


Custodian
Bank or other financial institution that keeps custody of stock certificates and other assets of a fund, individual, or corporate client.


Cyclical Stocks

Stocks that tend to rise quickly when the economy turns up and to fall quickly when the economy turns down.


CAC 40
French Stock Exchange.

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CONSOB
The Commissione Nazionale per le Società e la Borsa (CONSOB) is the public authority responsible for regulating the Italian securities market. Its activity is aimed at the protection of the investing public.

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