Financial Risk Manager

Ways of Financial and Risk Management

Financial and Business Terms - from Boo to Bou
Friday, May 15, 2009

Book cash: A firm's cash balance as reported in its financial statements. Also called ledger cash.
Book profit: The cumulative book income plus any gain or loss on disposition of the assets on termination of the SAT.
Book runner: The managing underwriter for a new issue. The book runner maintains the book of securities sold.
Book value: A company's book value is its total assets minus intangible assets and liabilities, such as debt. A company's book value might be more or less than its market value.
Book value: per share The ratio of stockholder equity to the average number of common shares. Book value per share should not be thought of as an indicator of economic worth, since it reflects accounting valuation (and not necessarily market valuation).
Book-entry securities: The Treasury and federal agencies are moving to a book-entry system in which securities are not represented by engraved pieces of paper but are maintained in computerized records at the Fed in the names of member banks, which in turn keep records of the securities they own as well as those they are holding for customers. In the case of other securities where a book-entry has developed, engraved securities do exist somewhere in quite a few cases. These securities do not move from holder to holder but are usually kept in a central clearinghouse or by another agent.
Bootstrapping: A process of creating a theoretical spot rate curve , using one yield projection as the basis for the yield of the next maturity.
Borrow: To obtain or receive money on loan with the promise or understanding that it will be repaid.
Borrower fallout: In the mortgage pipeline, the risk that prospective borrowers of loans committed to be closed will elect to withdraw from the contract.
Bottom-up equity management style: A management style that de-emphasizes the significance of economic and market cycles, focusing instead on the analysis of individual stocks.
Bought deal: Security issue where one or two underwriters buy the entire issue.
Bourse: A term of French origin used to refer to stock markets.