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Meaning / Definition of

Transparency

Categories: Investing and Trading, Economics,

Transparency is a measure of how much information you have about the markets where you invest, the corporations whose stocks or bonds you buy, or the mutual funds or other investments you select. For example, in order to achieve maximum transparency in US markets, the securities and exchange commission (SEC) requires corporations to disclose all information that might have an impact on their financial status so that investors can make fully informed decisions.Real-time trading information, increasingly available to individuals as well as institutional investors, and linked pricing systems are other steps toward complete transparency.

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Definition / Meaning of

Floating Rate

Categories: Credit and Debt,

A debt security or corporate preferred stock whose interest rate is adjusted periodically to reflect changing money market rates is known as a floating rate instrument. These securities, for example, five-year notes, are initially offered with an interest rate that is slightly below the rate being paid on comparable fixed-rate securities. But because the rate is adjusted upward from time to time, its market price generally remains very close to the offering price, or par.When a nation's currency moves up and down in value against the currency of another nation, the relationship between the two is described as a floating exchange rate. For example, the us dollar is worth more japanese yen in some periods and less in others. That movement is usually the result of what's happening in the economy of each of the nations and in the economies of their trading partners. A fixed exchange rate, on the other hand, means that two (or more) currencies, such as the us dollar and the Bermuda dollar, always have the same relative value.

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