Ask (Securities Trading) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is an Ask (Securities)?The ask price is used in the context of the trade of securities to describe the lowest price a seller is willing to accept before parting ways with a security. Is the price a seller will accept for the sale of a security. The ask price is...

Better Alternative Trading System – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Better Alternative Trading System?The Better Alternative Trading System (BATS) is a stock exchange founded in 2005. BATS is based in the United States, it offers foreign exchange services to investors and traders as well as equities and options. The better...

Benjamin Method – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is the Benjamin Method?The Benjamin Method is a formula used in investment to determine the intrinsic value of stocks in a bid to find assets that are undervalued to select the most profitable assets. The Benjamin Method is a value investing strategy which is...

Black’s Model – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Black’s Model?The Blacks model is a mathematical model for pricing derivative instruments such as options contract, swaptions, bond options, and other interest-rate derivatives. The Blacks model is otherwise called Black-76, it was first presented in...

Black Litterman Model – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is the Black-Litterman Model?The Black-Litterman model is a model used for an asset or portfolio allocation. This model was developed by two theorists at Goldman Sachs in 1990. The Black-Litterman model was named after Fischer Black and Robert Litterman, the...

Arbitrage Bond – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is an Arbitrage Bond?An Arbitrage bond is a bond issued by a municipality to refinance an existing higher-rate bond with a lower-rate bond prior to the call date of the former. Arbitrage bonds are issued by municipalities when they want to take advantage of the...

Appraisal Ratio – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is an Appraisal Ratio?An appraisal ratio can be used in different contexts to describe or measure the performance of a fund compared to the benchmark. The appraisal ratio also measures a mutual fund’s alpha relative to its risk. This ratio also measures the...

Bank Secrecy Act – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is the Bank Secrecy Act?How Does the Bank Secrecy Act Work?Ways the Bank Secrecy Act Is Applied What is the Bank Secrecy Act?The Bank Secrecy Act (BSA), which was passed in 1970, and is sometimes referred to as the Currency and Foreign...

Overhead Allocation Rate (Accounting) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting

What is Allocation Rate?The allocation rate is the amount of overhead cost per hour of labor that goes into the production of a unit. The calculation is as follows:Total Overhead x Total Labor Hours = Overhead Allocation Rate This calculation applies equally if you...

Bowie Bond – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Bowie Bond?A bowie bond is an example of a celebrity bond and was introduced by David Pullman in 1997, the investment banker of David Bowie. A celebrity bond is usually music-based. These bonds were issued in 1997 as asset-based security to cover the current...