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Blow-off top
A steep and rapid increase in price followed by a steep and rapid drop. This is an indicator seen in charts
and used in technical analysis of stock price and market trends.
Blue-chip company
Used in the context of general equities. Large and creditworthy company. Company renowned for the quality
and wide acceptance of its products or services, and for its ability to make money and pay dividends. Gilt-
edged security.
Blue-sky laws
State laws covering the issue and trading of securities.
Bogey
The return an investment manager is compared to for performance evaluation.
Boilerplate
Standard terms and conditions.
Bolt
Used for listed equity securities. Block trading version of colt.
Bond
Bonds are debt and are issued for a period of more than one year. The U.S. government, local
governments, water districts, companies and many other types of institutions sell bonds. When an investor
buys bonds, he or she is lending money. The seller of the bond agrees to repay the principal amount of the
loan at a specified time. Interest-bearing bonds pay interest periodically.
Bond agreement
A contract for privately placed debt.
Bond covenant
A contractual provision in a bond indenture. A positive covenant requires certain actions, and a negative
covenant limits certain actions.
Bond-equivalent basis
The method used for computing the bond-equivalent yield.
Bond equivalent yield
Bond yield calculated on an annual percentage rate method. Differs from annual effective yield.
Bond-equivalent yield
The annualized yield to maturity computed by doubling the semiannual yield.
Bondholder
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