derivative security
A security whose value is derived from another asset
option
Security that gives the holder the right (not the obligation) to purchase/sell an asset at a set price during a specified time period
exercise price
the price that the asset can be purchased/sold
expiration date
The last day that the option terms are valid
call
Option to purchase a particular asset (in our case, equity)
put
Option to sell a particular asset (in our case, equity)
convertible security
under certain conditions, the owner has the option to convert the security for the company's common stock
warrant
A company issued option to purchase a set number of shares at a predetermined price sometime in the future
rights-on
case where the purchasers receive the rights offering along with the share(s) of stock they purchase
Ex-rights
Case where the purchases only receive the share(s) of stock they purchase (i.e., they do not receive the rights offering)
swap
a contract to exchange cash payments at the time of maturity based on some underlying asset
Interest rate swap
Agreement to swap an existing interest rate obligation for another (usually fixed to variable or vice versa)
Credit default swap (CDS)
A type of credit insurance contract in which one party pays another party a fee (or "premium") to protect itself from the risk of default on a debt instrument (e.g., mortgage backed security)