The Scariest Investing Terms
- By DailyWorth Team
- October 31, 2011
Gather ‘round dear AssetClass readers. Today, in honor of Halloween, we have a tutorial in terror. Here are a few spine-tingling terms that investors should watch out for:
-
Zombie Stocks
These are shares that have been left for dead, but they aren’t dead yet. Exact definitions vary, but they're often described as shares of insolvent companies that are near or in bankruptcy.
Take, for example, the creepy penny-stock (BLIAQ) that was once Blockbuster (and is now BB Liquidating Inc.). Recently trading around two cents per share, these emaciated shares have continued to roam some investment portfolios.
-
Quadruple Witching
Beware the third Friday of March, June, September and December. On these days, four different types of tricky investments (stock options, stock index options, single stock futures and stock index futures) expire—a situation known as “Quadruple Witching.”
The phrase originates from the three famed witches in William Shakespeare’s “Macbeth.” And until 2002, there were just three of these types of investments expiring—hence the old name of “Triple Witching.”
These witches are feared for the increased volatility they can cause. That’s given these days another spooky nickname: Freaky Fridays.
-
The Misery Index
Add together the unemployment rate and the inflation rate, and you get the Misery Index. Recently, the Misery Index hit a 28-year high. Scary.
Boo: What scares you most about investing?
Brokerage Products: Not FDIC Insured • No Bank Guarantee • May Lose Value
|
The content in this website with the exception of that provided by Charles Schwab have been provided by third-parties and/or prepared by DailyWorth who is not affiliated with, associated with or endorsed by Charles Schwab & Co., Inc. (“Schwab”). Therefore, the information contained within the content of the website that has not been prepared by Schwab should not be considered as approved, endorsed or recommended by Schwab. Schwab does not guarantee that the Information is accurate, complete or timely, nor does Schwab make any warranties to you regarding any results from using the Information. This also includes any links that DailyWorth provides as a courtesy to users of their website to third-party websites. Third-party websites are owned and operated by independent information providers (“IIPs”).
Interviews with Schwab employees created by DailyWorth are for general informational purposes only and should not be considered an individualized recommendation or investment advice. Investing involves risks, including the potential loss of principal invested. Keep in mind that diversification strategies, do not ensure a profit and do not protect against losses in declining markets and may not be suitable for you.
The content provided by Schwab is for general informational purposes only and is not intended to be a substitute for specific individualized tax, legal or investment planning advice. Where specific advice is necessary or appropriate, Schwab suggests that you seek professional assistance.
Charles Schwab & Co., Inc. (“Schwab”). All rights reserved. Member SIPC. (0413-2767)
