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Bar
Slang for one million dollars.
Barbell strategy
A fixed income strategy in which the maturities of the securities included in the portfolio are concentrated at
two extremes.
Bargain hunter
Used in the context of general equities. Purchaser who is extremely selective in the price sought on a
transaction.
Bargain-purchase-price option
Gives the lessee the option to purchase the asset at a price below fair market-value when the lease expires.
BARRAs performance analysis (PERFAN)
A method developed by BARRA, a consulting firm in Berkeley, Calif. It is commonly used by institutional
investors applying performance attribution analysis to evaluate their money managers performances.
Barrier options
Option contracts with trigger points that, when crossed, automatically generate buying or selling of other
options. These are exotic options.
Base currency
Mainly applies to international equities. Currency in which gains/losses from operating an international
portfolio are measured.
Base interest rate
Related: Benchmark interest rate.
Base probability of loss
The probability of not achieving a portfolio expected return. Related: Value at risk.
Basic balance
In a balance of payments, the basic balance is the net balance of the combination of the current account and
the capital account.
Basic business strategies
Key strategies a firm intends to pursue in carrying out its business plan.
Basic IRR rule
Accept the project if IRR is greater than the discount rate; reject the project if it is lower than the discount
rate. It is wise to also consider Net Present Value for project evaluation.
Basis
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