What Does Sell To Open Mean? Sell to open is a brokerage instruction to open a short position in an options transaction. When trading options (calls or puts) there really are only two choices when placing an order. Traders can either open a position or close a position. If traders […]
Investing
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What Is Market Risk Premium? The market risk premium is the difference between the expected return on an investment and the risk-free rate. The market risk premium is part of the Capital Asset Pricing Model (CAPM). Analysts and investors use it to calculate the acceptable rate of return for an investment. […]
What Is the Operating Cash Flow Ratio? The operating cash flow ratio is a measure of how well cash flows generated from a company’s operations are covering current liabilities. The ratio can reveal a company’s liquidity in the short term. Using cash flow as opposed to net income is considered […]
What is the SEC Yield? The SEC yield is a standard yield calculation developed by the U.S. Securities and Exchange Commission (SEC). It allows for fairer comparisons of bond funds. It is based on the most recent 30-day period covered by the fund’s filings with the SEC. The yield figure reflects […]
What is Commercial Property? Commercial property is real estate that is used for business activities. The designation usually refers to buildings that house businesses. But, it can also refer to land used to generate a profit. Also, it includes large residential rental properties. The designation of a property as a […]
What Is a Forward Contract? Forward contracts are private agreements between two parties to buy or sell an asset at a specified price on a future date. A forward contract can be used for hedging or speculation. However, its specific nature makes it particularly suitable for hedging. The forward contract […]