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Maintenance Requirement
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The minimum amount of equity that must be maintained
in a margin account. As governed by the Federal Reserve's Regulation T,
when a person buys on margin, required levels must be maintained throughout
the life of the trade. The investor will receive a margin call if the value
of securities falls below the minimum maintenance requirement and cash or
securities must be deposited.
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Margin Call
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A request for additional funds resulting
from a decline in the equity percentage or from purchases in the account. A
margin call can be met by selling stock, depositing fully paid for stock into
the account or by depositing cash.
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Margin Debit
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Money a margin customer owes a broker for
loans to purchase securities.
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Margin Sell-Out Letter
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Prior notification of a liquidation of a
margin account by a broker after a margin call has failed to produce
additional equity to bring the margin to the required level. Also refers to
the prior notification of action by a broker when a customer fails to pay
for securities purchased and the securities received from the selling
broker are sold to cover the transaction.
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Market Order
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Order to buy or sell a security at the best
available price. The majority of orders executed are market orders.
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Market Risk
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Also known as systematic risk; risk that is common
to all securities of the same general class and thus cannot be eliminated
by diversification. A measurement of this is the Beta Coefficient.
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Market Value
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Is calculated as Current Price x Quantity of
shares.
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Maturity
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Reaching the date at which a debt instrument
is due and payable.
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Medium Term Notes (MTN's)
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Notes issued under Shelf Registration that
may have maturities of any length or coupon type. Dated date, maturity and coupon
is specified at the time of issuance.
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Moody's
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One of the best known bond rating agencies
in the country. Moody's also rates commercial paper, preferred and common
stock, and municipal short-term issues.
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