Stock Market Help
Here is a list of common financial terms. Click on the letter that corresponds with the first letter of the financial term to get the definition.
U.S. Savings Bond
These bonds (series EE) are zero coupon-like bonds sold by the U.S. government at 50% of face value that can be redeemed for face value after 5 years.
Uncovered Options
Selling a call option to open in which the seller does not own the underlying security position. Also called naked options.
Underlying Security
The security that must be delivered when another security is exercised. For example, if a call option is exercised, then the underlying stock is delivered to the call owner. Warrants, rights, options, and convertible securities all have underlying securities. For futures options, futures are the underlying security.
Undistributed Earnings
The same as retained earnings. It is earnings that are not paid as dividends, but reinvested in the company.
Unit
Smallest tradable component of an asset: share for stocks and mutual funds, $1000 quantity for most bonds, and contract for options and futures.
Unit Investment Trust
A package of investments, usually bonds, sold to investors as a unit which is a fractional ownership of the total package. Unlike a mutual fund, the investments in a unit do not change and are not replaced if they mature or are called. Usually sold by brokers.
Unlisted Security
A stock or bond not listed on an exchange (usually New York or American) which trade in the over-the-counter market.
Unpaid Dividend
A dividend that has been declared by a corporation but not yet paid. It is carried as a liability until the payment date.
Unsecured Debt
A bond issued by a corporation which is not backed by specific collateral. Same as debenture. It is backed instead by the general credit or promise to pay by the issuer.