Dr. Harvey's Financial Glossary

Monday, May 12, 2008

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De facto: Existing in actual fact although not by official recognition.
Dead cat bounce: A small upmove in a bear market.
Deal flow: In investment_bank, the rate at which new deals are referred to a brokerage firm.
Deal stock: Stock subject to merger or acquisition, either publicly announced or rumored.
Dealer: An entity that stands ready and willing to buy a security for its own account (at its bid price) or sell from its own account (at its ask price). Individual or firm acting as a principal in a securities transaction. Principals are market_maker in securities, and thus trade for their own account and risk. Antithesis of broker. See: Agency.
Dealer loan: Overnight, collateralized loan from a money market bank made to a dealer financing his position by borrowing.
Dealer market: Where traders specializing in particular commodities buy and sell assets for their own accounts.
Dealer options: Over-the-counter options, such as those offered by government and mortgage-backed securities dealers.
Dealer's spread: ; underwriting spread. See Also: Markdown
Dealing desk (Trading desk): Personnel at an international bank who trade spot_trade and forward foreign exchange.
Dear money: British term for tight money.
Death play: A stock strategy that buys stock on the belief that a key executive will die, the company will be dissolved, and shares will command a higher price at their private market value.
Death Spiral Convertible: Used by companies that are in such bad shape, that there is no other way to get financing. This instrument is similar to a convertible bond, but convertible at a discount to the share price at issuance and for a fixed dollar amount rather than a specific number of shares. The further the stock falls, the more shares you get. Popular in the mid to late 1990s. Also known as toxic convertibles or floorless convertibles.
Death Valley Curve: In venture capital, refers to the period before a new company starts generating revenues, when it is difficult for the company to raise money.
Death-backed bonds: Bonds backed by loans of a policyholder against a life insurance policy. The policyholder will repay the loans while alive or with the benefits from the insurance policy upon death.
Debenture: Any debt obligation backed strictly by the borrower's integrity, e.g. an un secured bond. A debenture is documented in an indenture.
Debenture bond: An unsecured bond whose holder has the claim of a general creditor on all assets of the issuer not pledged specifically to secure other debt. Compare subordinated debenture bond and collateral trust bonds.
Debenture stock: A type of stock that makes fixed payments at scheduled intervals of time. Debenture stock differs from a debenture in that it has the status of equity, not debt, in liquidation.
Debit: An expense, or money paid out from an account. A debit transaction is one which the net cost is greater than the net sale proceeds. See also Credit.
Debit balance: The amount that is owed to a broker by a margin customer for loans the customer uses to buy securities.
Debit card: A card that resembles a credit card but which debits a transaction account (checking account) with the transfers occurring contemporaneously with the customer's purchases. A debit card may be machine readable, allowing for the activation of an automated teller machine or other automated payments equipment.
Debit spread: Applies to derivative products. Difference in the value of two options, when the value of the option bought exceeds the value of the one sold. One buys a "debit spread." Antithesis of a credit spread.
Debt: Money borrowed.
Debt bomb: A default on debt and obligations by a major financial_institution that disrupts the stability of the economic system.
Debt capacity: Ability to borrow. The amount a firm can borrow up to the point where the firm value no longer increases.

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