Camouflage Compensation   -   Compensation that is granted to upper echelon employees, directors, consultants and related parties that is not fully disclosed in mandatory company filings. In other cases, compensation is fully disclosed, but in such a way that it is very difficult for the average investor to decipher the true value of gross pay compensation.

Capital Markets   -   Currencies and securities are sold here.

Capitulation   -   A military term. Capitulation refers to surrendering or giving up.

In the stock market, capitulation is associated with "giving up" any previous gains in stock price as investors sell equities in an effort to get out of the market and into less risky investments. True capitulation involves extremely high volume and sharp declines. It usually is indicated by panic selling.

Carbon Trade   -   An idea presented in response to the Kyoto Protocol that involves the trading of greenhouse gas (GHG) emission rights between nations.

Cardboard Box Index   -   An index used by some investors to gauge industrial production by using the output of cardboard boxes to predict the purchases of non-durable consumer goods.

Cash Cow   -   1. One of the four categories (quadrants) in the BCG growth-share matrix that represents the division within a company that has a large market share within a mature industry.
2. A business, product or asset that, once acquired and paid off, will produce consistent cash flow over its lifespan.

Casino Finance   -   Any investment strategy that is classified as extremely high risk.

Catalyst   -   Something that initiates or causes an important event to happen. Originally a term used in chemistry for the volatile (active) chemical in a formula.

Category Killer   -   Large companies that put less efficient and highly specialized merchants out of business.
Category killers can attain this status by being cheaper, easier, bigger, or more popular than the competition.

Cats and Dogs   -   A slang term referring to speculative stocks that have short or suspicious histories for sales, earnings, dividends, etc. The origin for this term may have stemmed from the use of "dog" to refer to an underperforming stock.

Caveat Emptor   -   A Latin phrase for "let the buyer beware." The term is primarily used in real property transactions. Essentially it proclaims that the buyer must perform their due diligence when purchasing an item or service.

CBOE   -   Chicago Board Options Exchange.  Founded in 1973, the CBOE is an exchange that focuses on options contracts for individual equities, indexes and interest rates. The CBOE is the world's largest options market. It captures a majority of the options traded. It is also a market leader in developing new financial products and technological innovation, particularly with electronic trading.
The CBOE is also referred to as the "See-bo"

CBOT   -   Chicago Board Of Trade. A commodity exchange established in 1848 that today trades in both agricultural and financial contracts. The CBOT originally traded only agricultural commodities such as wheat, corn and soybeans. Now, the CBOT offers options and futures contracts on a wide range of products including gold, silver, U.S. Treasury bonds and energy.

CFA   -   Chartered Financial Analyst. A professional designation given by the CFA Institute (formerly AIMR) that measures the competence and integrity of financial analysts. Candidates are required to pass three levels of exams covering areas such as accounting, economics, ethics, money management and security analysis.

Chameleon Option   -   An option that has the ability to change its structure, should certain pre-determined terms of the contract be met.

Channel Stuffing   -   A deceptive business practice used by a company to inflate its sales and earnings figures by deliberately sending retailers along its distribution channel more products than they are able to sell to the public.

Chasing Nickels around Dollar Bills   -   A slang term describing what a company's management does when it decides to trim small, trivial costs instead of cutting larger, more serious costs. All too often, managers will cut the difficult costs as a last resort, when in fact the company would be much better off if the larger costs had been dealt with earlier.

Chasing the Market   -   Entering or exiting of a trend after the trend has already been well established. Investors are often unaware of the fact that they are chasing the market, which can dent the value of a portfolio. This type of investing is often seen as irrational as decisions are often based on emotion instead of careful analysis of the value of the investment.

Chastity Bond   -   A bond designed to prevent unwanted takeovers by having a maturity that is activated once a takeover is complete.

Cherry Picking   -   1. The act of investors choosing investments that have performed well within another portfolio in anticipation that the trend will continue.
2. Relating to bankruptcy proceedings whereby the courts uphold contracts favorable to bankrupt companies, but annul those that are unfavorable.

Chief Investment Officer (CIO)   -   The executive position responsible for a company's investment portfolios. The chief investment officer (CIO) usually oversees a team of professionals that have responsibilities such as managing and monitoring investment activity, managing pensions, working with external analysts and maintaining good investor relations. They will also develop short-term and long-term investment policies.

Chill   -   Special restrictions that can be placed on a given security by the Depository Trust Company (DTC). Chill restrictions are intended to limit the potential for problems within the financial marketplace; they can be placed on a security for various reasons.

Chinese Wall   -   The ethical (not physical) barrier between different divisions of a financial (or other) institution to avoid conflict of interest. A Chinese Wall is said to exist, for example, between the corporate-advisory area and the brokering department to separate those giving corporate advice on takeovers from those advising clients about buying shares. The "wall" is thrown up to prevent leaks of corporate inside information, which could influence the advice given to clients making investments, and allow staff to take advantage of facts that are not yet known to the general public.

Christmas Tree   -   An options trading strategy that is generally achieved by purchasing one call option and selling two other call options at different strike prices. When drawn structurally, the strike price of the long option is located below the two successively higher written calls and loosely resembles a Christmas tree. 

Churning   -   1. An unethical practice employed by some brokers to increase their commissions by excessively trading in a client's account. This practice violates the NASD Fair Practice Rules. It is also referred to as "churn and burn", "twisting" and "overtrading". 
2. A period of heavy trading with few sustained price trends and little movement in stock market indexes.

CINS Number   -   An acronym standing for the "CUSIP International Numbering System," which provides identification of international securities.

Circuit Breaker   -   Refers to any of the measures used by stock exchanges during large sell-offs to avert panic selling. Sometimes called a "collar."

Circular Trading   -   A fraudulent trading scheme where sell orders are entered by a broker who knows that offsetting buy orders, the same number of shares at the same time and at the same price, either have been or will be entered.

Clean Sheeting   -   The fraudulent act of purchasing a life insurance policy without disclosing a pre-existing terminal illness or disease. This type of fraud is often done with both the knowledge of the purchaser and the agent involved.

Clean Your Skirts   -   A slang phrase used in the equity market to refer to a trader's obligation to make calls and check possible prior obligations related to a security transaction. Prior obligations may include confirming certain transaction details, such as limit prices or conditional events.

Clearing Bank   -   A bank whih deals with individual customers. It offers a variety of financial services, from operating accounts to selling pensions and insurance. Many of these banks also offer the services of merchant banks.  (Also known as high street bank, retail bank and personal bank)

Click and Mortar   -   A type of business model that includes both online and offline operations, which typically include a website and a physical store. A click-and-mortar company can offer customers the benefits of fast, online transactions or traditional, face to face service.
This model is also referred to as "clicks and bricks".

Clientele Effect   -   The theory that a company's stock price will move according to the demands and goals of investors in reaction to a tax, dividend or other policy change affecting the company. The clientele effect assumes that investors are attracted to different company policies, and that when a company's policy changes, investors will adjust their stock holdings accordingly. As a result of this adjustment, the stock price will move.

Clinton Bond   -   A bond that is said to have no principal, no interest and no maturity. Named after former President Bill Clinton and his well-documented "extravagances". Also known as a Quayle Bond, named after former Vice-President Dan Quayle.

Closing Price   -   The final price at which a security is traded on a given trading day. The closing price represents the most up-to-date valuation of a security until trading commences again on the next trading day.

Club Deal   -   A private equity buyout or the assumption of a controlling interest in a company that involves several different private equity firms. This group of firms pools its assets together and makes the acquisition collectively. The practice has historically allowed private equity to purchase much more expensive companies together than they could alone. Also, with each company taking a smaller position, risk can be reduced.

CNN Effect   -   The temporary shifting of consumer spending that occurs as a result of gripping news.

Coattail Investing   -   An investment strategy in which investors mimic the trades of well-known and historically successful investors.

Cockroach Theory   -   A market theory that suggests that when a company reveals bad news to the public, there may be many more related negative events that have yet to be revealed. The term comes from the common belief that seeing one cockroach is usually evidence that there are many more that remain hidden.

Coiled Market   -   A market that is believed to have the potential to make a strong move in one direction after being pushed in the opposite direction. The idea is that if a market should be headed in one direction based on its fundamentals but is pushed in the other direction, it will eventually make a strong move in the original fundamental direction. This coiled move will often be more substantial than what might have been the case if it had gone in the expected direction to begin with.

Cold Calling   -   A method used by brokers to obtain new business by making unsolicited calls to potential clients.

Com-Dev Company   -   Short form for "Commercial Development Company." These companies build and sell/lease commercial real-estate, software, or applications for wide-scale commercial use.

Commercial Bank   -   Provides financial services, such as the transfer, borrowing and lending of money to corporate clients. (Also known as corporate bank and wholesale bank)

Commoditize   -   The act of making a process, good or service easy to obtain by making it as uniform, plentiful and affordable as possible. Something becomes commoditized when one offering is nearly indistinguishable from another. As a result of technological innovation, broad-based education and frequent iteration, goods and services become commoditized and, therefore, widely accessible.

Commodity   -   1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When they are traded on an exchange, commodities must also meet specified minimum standards, also known as a basis grade. 
2. Any good exchanged during commerce, which includes goods traded on a commodity exchange.

Commodity ETF   -   Exchange-traded funds that invest in physical commodities such as agricultural goods, natural resources and precious metals. A commodity ETF may be focused on a single commodity and hold it in physical storage or may invest in futures contracts. Other commodity ETFs look to track the performance of a commodity index that includes dozens of individual commodities through a combination of physical storage and derivatives positions.
Because many commodity ETFs use leverage through the purchase of derivative contracts, they may have large portions of uninvested cash, which is used to purchase Treasury securities or other nearly risk-free assets.

Comps   -   A buzzword that refers to a retail firm's comparable same-store sales. Comps compare the degree of revenue growth/decline that a firm's stores achieve relative to their sales in previous years. Sales numbers from stores that have been operating for more than a full year are used in the comparison.
The metric can be used by investors to help determine what portion of new sales has come from sales growth and what portion from the opening of new stores. Comps are usually released by companies on a monthly basis.
Also known as "comparable same-store sales."

Contagion   -   The likelihood of significant economic changes in one country spreading to other countries. This can refer to either economic booms or economic crises.

Control Stock   -   1. Equity shares owned by major shareholders of a publicly traded corporation. These shareholders have either a majority of the shares outstanding or a portion of the shares that is significant enough to allow them to exert a controlling influence on the firm's decisions.
2. In situations where companies have more than one class of common shares, shares with superior voting power or vote weighting are considered to be control stocks, relative to the inferior class.

Convertible Bond   -   A bond that can be converted into a predetermined amount of the company's equity at certain times during its life, usually at the discretion of the bondholder.
Convertibles are sometimes called "CVs".

Cook the Books   -   A buzzword describing fraudulent activities performed by corporations in order to falsify their financial statements. Typically, cooking the books involves augmenting financial data to yield previously non-existent earnings. 
Examples of techniques used to cook the books involve accelerating revenues, delaying expenses, manipulating pension plans and implementing synthetic leases.

Cookie Jar Accounting   -   An accounting practice where a company uses generous reserves from good years against losses that might be incurred in bad years.

Core Competencies   -   The main strengths or strategic advantages of a business. Core competencies are the combination of pooled knowledge and technical capacities that allow a business to be competitive in the marketplace.  Theoretically, a core competency should allow a company to expand into new end markets as well as provide a significant benefit to customers. It should also be hard for competitors to replicate.  

Core Holding   -   An investment that you plan on keeping in your portfolio for a very long period of time, sometimes permanently.

Corner   -   1. The act of securing enough controlling interest or ownership within a single security so that manipulation of price can occur.
2. A rare situation occurring in commodity markets wherein the quantity of underlying securities and commodities available are exceeded by the commitments of delivery quantities on future contracts.

Corner a Market   -   To acquire enough shares of a particular security in order to manipulate its price.

Corporate Cannibalism   -   An act of self-infringement upon market share by corporations through the issuance of new products.
Also known as "market cannibalization".

Corpoarte Kleptocracy   -   Buzzword that describes the greed of corporate executives who use underhanded tactics to siphon off wealth at the expense of shareholders. This buzzword is attributed to how ex-Hollinger CEO, Conrad Black, and his fellow associates allegedly embezzled hundreds of millions of dollars over a seven-year period from Hollinger.

Corporate Social Responsibility   -   Corporate initiative to assess and take responsibility for the company's effects on the environment and impact on social welfare. The term generally applies to company efforts that go beyond what may be required by regulators or environmental protection groups.  
Corporate social responsibility may also be referred to as "corporate citizenship" and can involve incurring short-term costs that do not provide an immediate financial benefit to the company, but instead promote positive social and environmental change.  

Coverage Initiated   -   When a brokerage or analyst issues his/her first rating on a particular stock.

Cowboy Marketing   -   A slang term to describe a situation in which a company is unaware that a marketer hired to produce legitimate opted-in email campaigns is actually using mass spam emails to promote the company's stock. This is a very unethical practice because marketers are often compensated with stock options, allowing them to capitalize on the unfounded demand they create for the stock they are promoting.

Crack   -   A trading strategy used in energy futures to establish a refining margin.

Crack Spread   -   In commodity markets, the spread created by purchasing oil futures and offsetting the position by selling gasoline and heating oil futures. This investment alignment allows the investor to hedge against risk due to the offsetting nature of the securities.

Crash   -   A major decline in a financial market. (see Wall Street History)

Creative Destruction   -   A term coined by Joseph Schumpeter in his work entitled "Capitalism, Socialism and Democracy" (1942) to denote a "process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one."

Credit Crisis   -   A crisis that occurs when several financial institutions issue or are sold high-risk loans that start to default. As borrowers default on their loans, the financial institutions that issued the loans stop receiving payments. This is followed by a period in which financial institutions redefine the riskiness of borrowers, making it difficult for debtors to find creditors.

Credit Crunch   -   An economic condition in which investment capital is difficult to obtain. Banks and investors become wary of lending funds to corporations, which drives up the price of debt products for borrowers.

Crossover Investor   -   An investor who invests prior to, during and following a company's initial public offering.

Crown Jewels   -   The most valuable unit(s) of a corporation, as defined by characteristics such as profitability, asset value and  future prospects. The origins of this term are derived from the most valuable and important treasures that sovereigns possessed.

Cult Stock   -   A classification describing stocks that have a sizable investor following, despite the fact that the underlying company has somewhat insignificant fundamentals. Typically, investors are initially attracted to the company's potential and accumulate positions in speculation that its potential will be fulfilled, providing the investors with a substantial payout.

Curb Trading   -   Trading that occurs outside of general market regulations, commonly through computers or telephones after the official exchanges have closed.
Also known as "kerb trading".

CUSIP Number   -   An identification number assigned to all stocks and registered bonds. The Committee on Uniform Securities Identification Procedures (CUSIP) oversees the entire CUSIP system.

Customer to Customer (C To C)   -   A type of business model that facilitates interaction between customers. Customer to customer businesses provide individuals with a place to converse, exchange and interact with other people.
Also sometimes referred to as "C2C".

Cutoff Point   -   The point at which an investor decides whether or not a particular security is worth purchasing. The cutoff point is very subjective and will be based on the personal characteristics of the individual investor. Some examples of personal characteristics that may determine the cutoff point include the investor's required rate of return and his or her risk aversion level.

Cutting a Melon   -   A slang term used to describe the situation where a board of directors declare an additional dividend in addition to the regular distribution. The additional dividend can be in the form of cash, stock or property.

Cyber Monday   -   An expression used in online retailing to describe the Monday following U.S. Thanksgiving weekend. Cyber Monday is generally thought of as the start of the online holiday shopping season. Similar to Black Friday, (the unofficial start of the holiday season for offline businesses), online retailers will usually offer special promotions on this day.
Also known as "Black Monday".

Cyclical Industry   -   A type of an industry that is sensitive to the business cycle, such that revenues are generally higher in periods of economic prosperity and expansion, and lower in periods of economic downturn and contraction.
Companies in cyclical industries can deal with this type of volatility by implementing cuts to compensations and layoffs during bad times, and paying bonuses and hiring en masse in good times. Cyclical industries include those that produce durable goods such as raw materials and heavy equipment.