Business Glossary: O

AIM THIS PAGE

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

O Fifth letter of a Nasdaq stock symbol specifying that it is the company's second class of preferred shares.

OAS See: Option adjusted spread

OCC See: Options Clearing Corporation

OECD See: Orgainization for Economic Cooperation and Development

OID See: Original issue discount debt

OM The two-character ISO 3166 country code for OMAN.

OMR The ISO 4217 currency code for the Oman Rial.

OSE See: Osaka Securities Exchange

OTC See: Over-the-counter.

OTM See: Out of the money.

OPEC See: Organization of Petroleum Exporting Countries

Oath of Inspectors A sworn statement signed by the Inspectors of Election, usually notarized, wherein they swear they will impartially and faithfully execute their duties as Inspectors of Election at the annual or special meeting of shareholders.

Objective (mutual funds) The fund's investment strategy category as stated in the prospectus. There are more than 20 standardized categories. E.g. Aggressive growth, balanced.

Objective probability The true unobservable underlying odds that something is so.

Obligation A legal responsibility, such as to repay a debt.

Obligation bond A municipal bond with a face value greater than the value of the underlying property. The difference is designed to compensate the lender for costs exceeding the mortgage value.

Obligor A person who has an obligation to pay off a debt.

Observational Noise The error between the true value in a system and its observed value due to imprecision in measurement. Also called Measurement Noise. See: Dynamical Noise.

Ocean bill of lading Receipt for a shipment by boat, that includes freight charges and title to the merchandise.

Odd lot A trading order for less than 100 shares of stock. Compare round lot.

Odd-Lot Buy Back An offer made by the corporation or its agent to purchase shares from odd-lot shareholders.

Odd-lot dealer A broker who combines odd lots of securities from multiple buy or sell orders into round lots and executes transactions in those round lots.

Odd-Lot Resale An offer made by the corporation or its agent to purchase shares from odd-lot shareholders and immediately resell them in the market, usually in round-lots to institutions, thus saving the corporation the expense of merely buying shares back.

Odd-lot short-sale ratio The percentage of total odd-lot sales that is composed of short sales.

Odd-lot theory The theory that profits can be made by making trades contrary to odd-lot trading patterns, since odd-lot investors have poor timing. This theory is no longer popular.

OEX index Applies to derivative products. Quotron symbol for the S&P 100 index option.

Off-balance-sheet financing Financing that is not shown as a liability on a company's balance sheet.

Off-board Used for listed equity securities. Transacted away from a national securities exchange even though the stock itself is listed, such as on the NYSE, and instead of on the OTC market, a regional exchange, or in the third or fourth markets (between customers directly). After 9:30 a.m., if the stock has not opened due to the exchange's discretion, trading can occur elsewhere, but the trader must assume the role of a quasi-specialist in the process.

Off-budget Federal entities Federally owned and controlled entities whose transactions are excluded from the budget totals under provisions of law. Their receipts, outlays, and surplus or deficit are not included in budget receipts, outlays or deficits. Their budget authority is not included in totals of the budget.

Off-floor order Used for listed equity securities. (1) Order to buy or sell a security that originates off the floor of an exchange; customer orders originating with brokers, as distinguished from orders placed by floor members trading for their own accounts. Exchange rules require that an off-floor order be executed before orders initiated on the floor. Upstairs order. Antithesis of on-floor order; (2) order not handled on the floor but instead upstairs.

Offer Indicates a willingness to sell at a given price. Related: Bid.

Offer price See: Offer.

Offer wanted Used in the context of general equities. Notice by a potential buyer of a security that he or she is looking for supply from a potential seller of the security, often requiring a capital commitment. Antithesis of bid wanted.

Offering date Date on which a new set of stocks or bonds will first be sold to the public.

Offering memorandum A document that outlines the terms of securities to be offered in a private placement.

Offering scale The range of prices offered by the underwriter of a serial bond issue with different maturities.

Offering statement A shortened registration statement required by the Securities and Exchange Commission on debt issues with less than a nine-month maturity.

Offerings Often refers to initial public offerings. When a firm goes public and makes an offering of stock to the market.

Office of Thrift Supervision (OTS) An agency of the U.S. Treasury department responsible for the U.S. savings and loan industry.

Official reserves Holdings of gold and foreign currencies by official monetary institutions.

Official statement A statement published by an issuer of a new municipal security describing itself and the issue.

Official settlements balance (overall balance) An overall measurement of a country's private financial and economic transactions with the rest of the world.

Official unrequited transfers Include a variety of subsidies, military aid, voluntary cancellation of debt, contributions to international organizations, indemnities imposed under peace treaties, technical assistance, taxes, or fines.

Offlake In the context of project financing, the purchase of the project's output.

Offset Elimination of a long or short position by making an opposite transaction. Related: Liquidation.

Offshore finance subsidiary A wholly owned affiliate incorporated overseas, usually in a tax haven country, whose function is to issue securities abroad for use in either the parent's domestic or foreign business.

Offshore fund A mutual fund whose headquarters is based outside the United States.

"O.K. to cross" Used for listed equity securities. "Legal to cross the buy and sell orders on the exchange floor because transactor is not a principal in the transaction."

Old-line factoring Factoring arrangement that provides collection, insurance, and finance for accounts receivable.

Oligopoly A Market characterized by a small number of producers who often act together to control the supply of a particular good and its market price.

Oligopsony A Market characterized by a small number of large buyers who control all purchases and therefore the market price of a good or service.

OM Stockholm AB The derivatives market of Sweden, trading a wide variety of interest rate and bond futures. The exchange trades futures and options on the OMX equity index.

Omitted dividend A dividend that was scheduled to be declared, but that is not voted by the Board of Directors probably because the company is experiencing financial difficulties.

Omnibus account An account carried by one futures commission merchant with another futures commission merchant in which the transactions of two or more persons are combined and carried in the name of the originating broker, rather than designated separately. Related: Commission house.

Omnibus Proxy A list issued by depositories detailing their participants, and their holdings, and authorizing the participants to vote their proxies directly. This type of proxies are issued by Cede & Co. and by certain bank custodians.

On Used in the context of general equities. Conjunction that denotes trade execution /indication, usually during a pre-opening look. "Looks 6 on 6000 shares at opening." See: for/at.

On balance Used for listed equity securities. Left over after pairing off other market buy and sell orders, usually before the opening of a stock or market but at times at the close (especially during index expirations). See: Imbalance of orders.

On board Used in the context of general equities. Long.

On Board Ocean Bill of Lading An ocean bill of lading bearing an on board notation, or words indicating that the merchandise is located aboard the vessel for transportation. These notations must be initialed or signed by an authorized employee or agent of the ship line.

On Carriage Freight costs arising after the cost of principal international freight costs. These are usually inland freight charges for delivery within the buyer's country.

On a clean up Used in the context of general equities. Willingness to participate in part of a trade if all of the stock available is spoken for except for the "clean up amount."

On the close order A market order that is to be executed as close as possible to the closing price of the day.

On-floor order Used for listed equity securities. Security order originating with a member on the floor of an exchange when dealing with his or her own account, versus an upstairs order. Antithesis of off-floor order.

On the money Used in the context of general equities. In-line, or at the same price, as the last sale.

On the opening order A market order that is to be executed at the price of the first trade of the day.

On the print Used in the context of general equities. To participate in a block trade that has already transpired, as if that customer had been part of the trade originally; often used by a new party looking to participate in a trade that has just happened. See: Open on the print.

On the run The most recently issued (and typically the most liquid) government bond in a particular maturity range.

On the sidelines An investor who decides not to invest due to market uncertainty.

On the take Used in the context of general equities. Price moving upward, because more buyers are taking offerings, causing offerings to vanish and be replaced by higher ones. Antithesis of come in, get hit.

On the tape Used in the context of general equities. (1) Trade printed on the ticker tape; (2) news displayed on Reuters or the Dow Jones News Service.

One-decision stock A quality stock that is not actively traded, but rather held for its growth potential.

One-factor APT A special case of the arbitrage pricing theory that is derived from the one-factor model by using diversification and arbitrage. It shows that the expected return on any risky asset is a linear function of a single factor.

144 stock Used in the context of general equities. Restricted stock.

One-man picture When both bid and the offered prices of a broker come from the same source.

1/f Noise See: Anti-Persistence

One-share-one-vote rule The principle that all shareholders should have equal voting rights in public companies and each shareholder should have one vote.

One-way market (1) A market in which only one side, the bid or asked, is quoted or firm. (2) A market that is moving strongly in one direction.

OPD Tape symbol showing either the first transaction of the day in a security after a delayed opening or the opening transaction in a security whose price has experienced a large rise or fall from the previous day's closing price.

Open Used in the context of general equities. Having either buy or sell interest at the indicated price level and side of a preceding trade. "Open on the buy/sell side" means looking for buyers/sellers (for someone who is a seller/buyer). Antithesis of clean.

Open account Arrangement whereby sales are made with no formal debt contract. The buyer signs a receipt, and the seller records the sale in the sales ledger.

Open book See: Unmatched book

Open contracts Contracts that have been bought or sold without completion of the transaction by subsequent sale or purchase, or by making or taking actual delivery of the financial instrument or physical commodity.

Open depending on the floor Used for listed equity securities. Having room for a customer buyer or seller contingent on the results of a trade being executed on the floor (i.e., satisfying the specialist book and the orders the trader opened up). See: Open on the print, subject.

Open-end credit Revolving line of credit that is extended with every purchase or cash advance.

Open-end fund Used in the context of general equities. Mutual fund that continually creates new shares on demand. Mutual fund shareholders buy the funds at net asset value and may redeem them at any time at the prevailing market prices. Antithesis of closed-end fund.

Open-end lease A lease agreement that provides for an additional payment at the expiration of the lease to adjust for any change in the value of the property.

Open-end mortgage Mortgage against which additional debts may be issued. Related: Closed-end mortgage.

Open interest The total number of derivatives contracts traded that have not yet been liquidated either by an offsetting derivative transaction or by delivery. Related: Liquidation.

Open-market operation Purchase or sale of government securities by the monetary authorities to increase or decrease the domestic money supply.

Open-market purchase operation A systematic program of repurchasing shares of stock in market transactions at current market prices, in competition with other prospective investors.

Open-market rates Interest rates that are determined in the open market by supply and demand, as opposed to being set by the Federal Reserve Board.

Open (good-till-cancelled) order (GTC order) Order to buy or sell a security that stays active until it is completed or the investor cancels it.

Open-outcry The method of trading used at futures exchanges, typically involving calling out the specific details of a buy or sell order, so that the information is available to all traders.

Open Policy A marine cargo insurance policy issued to cover various unspecified exports over the life of the policy.

Open position A net long or short position whose value will change with a change in prices.

Open on the print Used in the context of general equities. Block trader's term for a block trade that has been completed with an institutional client and printed on the consolidated tape, but leaves the block trader with stock available (because the trader has taken a long or short position to complete the trade) for new customers who are on the opposite side of the market to the initiating customer.

Open repo A repurchase agreement with no definite term. The agreement is made on a day-to-day basis, and either the borrower or the lender may choose to terminate. The rate paid is higher than on overnight repo and is subject to adjustment if rates move.

Open up Used in the context of general equities. Disclose more information (e.g.,