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Super Finance Glossary

Over 10,000 financial glossary terms...

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Browsing by the letter "D"

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Dual-purpose Fund
Definition: A closed-end fund consisting of two classes of shares. The two classes are preferred shares, on which shareholders receive all the dividends and interest from the portfolio, and common shares, on which shareholders receive all the capital gains.
Due Bill
Definition: An instrument evidencing the obligation of a seller to deliver securities sold to the buyer. Occasionally used in the bill market.
Due Date
Definition: Date on which a debt must be paid.
Due Diligence
Definition: An internal audit of a target firm by an acquiring firm. Offers are often made contingent upon resolution of the due diligence process.
Due Diligence Meeting
Definition: Meeting legally required to be held by an underwriter to enable brokers to question a new issuer about an upcoming issue.
Due-on-sale Clause
Definition: A mortgage contract clause stipulating that the borrower pay off the full remaining principal on a mortgage if the mortgaged property is sold before the mortgage is paid off.
Dumping
Definition: Used in the context of general equities. Offering large amounts of stock with little or no concern for price or market effect.
Duplicate Proxy
Definition: A second proxy received on an account. If the second proxy bears a more recent date than the first proxy, and has a different voting pattern, the second proxy will override the first.
Duplicative Portfolio
Definition: Mainly applies to derivative products. Basket of stocks that imitates the price movement of another set of securities (e.g., S&P 500 index).
Dupont System Of Financial Control
Definition: Highlights the fact that return on assets (ROA) can be expressed in terms of the profit margin and asset turnover.
Durable Merchandise
Definition: Goods that have a relatively lengthy life (television sets, radios, etc.).
Duration
Definition: A common gauge of the price sensitivity of a fixed income asset or portfolio to a change in interest rates.
Duration Drift
Definition: Change in duration attributable to the passage of time.
Duration Matching Strategy
Definition: An immunization technique that matches asset duration with the duration of the liabilities.
Dutch Auction
Definition: Auction in which the lowest price necessary to sell the entire offering becomes the price at which all securities offered are sold. This technique has been used in Treasury auctions. Often used in risk arbitrage. Auction system in which the price of an item (stock) is gradually lowered until it meets a responsive bid (government T-bills) or offer (corporate repurchase) and is sold. In a corporate repurchase, a range of prices is set by the company within which shareholders are invited to tender their shares. The tender offer is open for a specific period of time (i.e., 20 days), and the quantity of stock to be purchased is stated as well, subject to proration if more shares are tendered than can be legally purchased under the stated terms (often an additional amount equal to 20% of outstanding shares can be purchased). The price paid is that at which the amount stated to be purchased can be sold. Compare to double auction system.
Dutch Auction Preferred Stock
Definition: A form of adjustable-rate preferred stock in which the dividend is ascertained in a Dutch Auction process by corporate bidders every seven weeks.
Duty
Definition: A tax on imports, exports, or consumption goods.
Dwarfs
Definition: Fannie Mae issued mortgage-backed securities pools that have an original maturity of 15 years.
Dynamic
Definition: For option strategies, describing analyses made during the course of changing security prices and during the passage of time. This is as opposed to an analysis made at expiration of the options used in the strategy. A dynamic break-even point is one that changes as time passes. A dynamic follow-up action is one that will change as either the security price changes or the option price changes or time passes.
Dynamic Asset Allocation
Definition: An asset allocation strategy in which the asset mix is quantitatively shifted in response to changing market conditions, as in a portfolio insurance strategy, for example.
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