Halo Effect – Explained

by TheBusinessProfessor | Feb 23, 2025 | Management, Leadership, & Organizational Behavior

What is the Halo Effect?The halo effect is a type of cognitive bias. Individuals tend to let their overall impression of a person influence how they see a person’s specific traits or characteristics. The halo effect is highly important in business marketing,...

Yellow Book (Auditing Standards) – Explained

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

What is the Yellow Book?The Yellow Book, formally the Generally Accepted Government Auditing Standards (GAGAS), is the name given to the standards promulgated by the Comptroller General (of the Government Accountability Office) for carrying out financial audits of...

Pure Yield Pickup Swap – Explained

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

What is a Pure Yield Pickup Swap?A pure yield pickup swap is bond purchase and sale transaction, where the investor swaps her short-term, low-yield bond is exchanged for a longer-term, higher-yield bond.How Does a Pure Yield Pickup Swap Work?This transaction is used...

Yield to Call – Explained

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

How Does Yield To Call?The Yield to Call refers to the interest that a bond or note will pay if the investor purchases and holds the instrument until its call date. A bond has a purchase price based upon the present value of future interest payments (coupons) and...

York Antwerp Rules – Explained

by TheBusinessProfessor | Feb 23, 2025 | Global Business, International Law & Relations

What are the York Antwerp Rules?The York Antwerp Rules are a set of model internal maritime rules concerning the rights and obligations of vessel and cargo owners when cargo aboard a vessel must be jettisoned (thrown overboard). The rules were created by an...

Yield Spread – Explained

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

What is a Yield Spread?Debt instruments with different characteristics, such as maturity date or credit/risk rating, generally have different yields. The yield spread is the difference between yields on these instruments. When the yield on a two-year treasury bond is...

Yield Curve – Explained

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

What is a Yield Curve?The yield curve is a graphical representation (line plot) of the interest rates of similar quality bonds with varying maturity dates. The most commonly reported yield curves plot the 3-month, 2-year, 5-year, 10-year, and 30-year U.S. Treasury...

Zero Basis Risk Swap – Explained

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

What is a Zero Basis Risk Swap?A zero basis risk swap (ZEBRA), also called a perfect swap, or actual rate swap, is a swap arrangement between a municipal government and a financial intermediary. Basically, the municipality agrees to receive a floating (variable)...

Zero Cost Collar Option Strategy – Explained

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

What is a Zero Cost Collar?A Zero-Cost Collar, also known as a zero-cost option, equity risk reversal, or hedge wrapper, is an option strategy where an investor holding shares of a particular stock simultaneously buys an out-of-the-money put option (an option to make...

Energy or Royalty Trust – Explained

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

What is an Energy Trust?An energy trust is a kind of business entity that invests in operational assets (such as oil, gas and other minerals). The majority of the profits generated from these resources are then distributed to investors. Energy trusts do not invest in...