P

Paper profit (loss)
A profit (or loss) that has not yet been realized because the security is still held.

Par
A security's dollar amount, as stipulated by the issuing institution. Par value for a bond is the face (maturity) value.

Participating preferred
Preferred stock that pays an additional dividend (participating dividend) based on common stock dividend payments.

Penny stocks
A highly speculative stock selling for less than five dollars per share.

Point
A unit of financial measurement. Stock points are one dollar per share. Debt instrument points are one percent of face value. Loan or mortgage points are one percent of the loan amount.

Portfolio
An individual or institution's collection of assets (financial and/or real).

Position
The number of securities contracts either owned (long) or owed (short).

Preferred stock
A security that usually pays a fixed dividend and that gives the holder a claim on corporate earnings and assets that is superior to that of holders of common stock.

Premium
Amount paid for a stock above its par value.

Price-to-earnings ratio
Common measure of a stock's price. Determined by dividing the current stock price by current earnings per share (adjusted for stock splits) for one year. If a stock is trading at $20 per share and is earning $2 per share, its P/E ratio is 10.

Primary distribution
Another term for initial public offering (IPO).

Prime rate
A commercial bank's lowest interest rate, charged to their most credit-worthy customers.

Principal
The total amount of money being borrowed or loaned. The person affected by a broker's actions.

Privatization
The act of returning government-owned to privately held.

Probate
The review of a will by a legal authority to determine validity, as well as the process of distributing a deceased person's property to heirs.

Product cycle
The time needed to bring new and/or improved products to the market.

Profit-taking
When investors sells stocks that have appreciated since purchase to realize profits. Typically followed by a market downturn.

Program trading
Trades based on directions issued from computer applications and executed automatically.

Prospectus
A formal written offer to sell securities that sets forth the plan for a proposed business enterprise, or the facts concerning an existing one that an investor needs to make an informed decision.

Proxy
Written power of attorney given by a shareholder of a corporation, authorizing someone to vote on his or her behalf at corporate meetings.

Proxy statement
Material information required by the Securities and Exchange Commission to be given to a corporation's stockholders as a prerequisite to solicitation of votes. It is required for any issuer subject to the provisions of the Securities Exchange Act of 1934.

Public offering
The sale of registered securities in the public market through an underwriter.

Put
An option granting the right (but not the obligation) to sell a security at a specified price on or before a specific date.

Put price
The price at which an asset will be sold if a put option is exercised. Also called the strike price.
 

Securities offered through First Allied Securities, Inc.   A register broker/dealer.  Member FINRA/SIPC.
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