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The Scariest Investing Terms Comments

  • By DailyWorth Team
  • October 31, 2011

Zombies 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?

Tagged in: Investing, How to invest
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