What Is Meant By Above Par?

When a security is higher than par or nominal value.

What Is An Account Of Sales?

A statement of purchases or sales, or both, rendered to his client by a broker.

What Are Accounts And Risks?

Brokers use forms on which are the words, "Buy or sell for my account and risk," for the use of their customers when giving orders for purchases or sales of securities. This means that when an order as given is executed by the broker, it is for the account and risk of the customer and that the broker is acting as the agent only in the matter; therefore, is in no sense personally liable. The customer is held entirely responsible for the transaction.

What Are Actual Rates?

The actual prices at which sterling exchange is bought and sold at any given time.

What Is Meant By Afloat?

Used in the grain trade to designate the amount of grain which has been exported, but has not arrived at its destination.

What Is An Allotment?

It is a term used in connection with underwriting syndicates in the amounts assigned to members or subscribers. When an underwriting syndicate is being formed and different concerns are subscribing for portions of the underwriting, it is the custom that the managers of the syndicate have it in their power to allot to a subscriber less than the amount applied for, provided the total subscription or underwriting exceeds the total amount offered for subscription. Many-instances have occurred where an over-subscription of a stock or bond issue has been so great that the subscribers' final allotment is only a small proportion, sometimes only 10% of the amount for which he has subscribed. Such subscriptions have frequently, in popular securities, induced underwriters to subscribe for greater amounts than they expected to receive and thereby have been able to secure the allotment actually desired.

What Is An Apex?

The real definition of the word is "point," or "top." Applied to mining, apexing means mining a claim where the ledge apexes or comes to a point, on an adjoining claim or property. The law gives to the owner of a mining claim the right to mine an apex to its depth by following the vein, whether the vein continues on that particular claim or not.

What Is Meant By Arbitrage?

The meaning of this expression is buying and selling of securities in two different markets, as in New York and London or New York and San Francisco, the purpose being to make a profit from the difference in the quotations between the two markets. Some brokers do an extensive business in arbitrage, as follows:

Arbitrage in stocks is based on the temporary differences in prices between the different markets for the same stock. When a stock is selling at a higher price in one market than in another, it is sold in the market where the higher price prevails and is bought in the market where the lower price prevails. When equality in price has been restored he closes his transactions by buying where he sold and selling where he bought. The difference in the market prices represents his profit.

Calculating values for American stocks on the London Stock Exchange requires figuring of prices on the London Exchange 2higher than the prices for the same stocks on the New York Stock Exchange when they are actually the equivalent of the prices on the New York Stock Exchange. In arbitrage dealings, consequently, allowance has to be made for this difference in prices between London and New York, which is merely figurative, but not actual. The figure of 2⅝ mentioned is reached as follows: In dealings in American stocks on the London Stock Exchange four shillings is counted as one dollar. Four shillings being equal to 97 1-3 cents, the price of an American stock must be 2 2-3% (quotably, 2⅝%) higher in London than in New York, if the London price is at a parity with the New York price. 2⅝% of the par value is not to be added arbitrarily to the New York price, but 2⅝% of the New York price is to be added to the New York price to make an equivalent London price.