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Obscure words for money8/4/2023 Garbatrage: When price and trading volume in a particular sector surge due to a high-profile takeover in that industry. Because it effectively misleads investors - making them think goals are being met even when the company is losing footing - this practice is forbidden by the SEC.ħ. Cookie jar accounting: An accounting practice in which a company stores up funds during good times to dip into during bad times. It can also refer to industry-wide suspicions - if one subprime lender is going bankrupt (like New Century Financial was in 2007), other subprime lenders might have similar problems behind the scenes.ĥ. Cockroach theory: The theory that when a company reports bad news to the public, there's usually a lot more bad news behind the scenes that may come out later. Chasing nickels around dollar bills: The practice of big companies trimming small, trivial costs (like candy in the lobby) instead of big, serious costs (like the entire research department).Ĥ. Though they can be solid investments with good, steady returns, many investors ignore them for "cleaner," trendier stocks.ģ. Big uglies: Big, older companies, usually in "dirty" industrial sectors like mining or steel. Small cap just means a company with a relatively low value, or market capitalization - usually somewhere between $300 million and $2 billion.Ģ. Ankle biter: This phrase - used outside the world of finance to describe small children who are so little that they, metaphorically at least, barely reach an adult's ankles - can also be used to describe a small cap investment.
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