Value
Line Equity Rating Criteria
Using a computerized model based on a corporation's earnings growth potential,
Value Line's Equity Rating Criteria ranks corporations for both timeliness
and safety as follows:
1. Highest rank
2. Above average rank
3. Average rank
4. Below average rank
5. Lowest rank.
See: Rating; Risk;
Value Line Investment Survey
Value
Line Investment Survey (VL)
An investment advisory service that ranks hundreds of securities for safety
and timeliness. It projects which securities should have the best or worst
price performance over the next year. Moreover, each corporation is assigned
a risk rating. The ratings identify the volatility of a corporation's
stock price behavior compared to the market average. Subscribers to the
service receive weekly write-ups detailing corporations' financial information,
and data such as corporate insider buying and selling decisions and the
percentage of a corporation's shares held by institutions.
See: Fundamental Analysis;
Insider; Institutional
Investor; Rating; Risk/Reward
Ratio; Value Line Equity
Rating Criteria; Volatility
Variable Annuity
This is a life insurance contract whose value can fluctuate depending
on the investment which has been made (stocks, government securities,
etc). The movement in price in the underlying investments will drive the
value of the annuity contract. The return to the investors can be taken
in the form of a periodic payment or a fixed minimum payment.
See: Fixed Annuity
Variable Life
Insurance
A variation of whole life insurance created to fight inflation and to remain
competitive with other investment vehicles that provide higher rates of
return. It affords policyholders a chance to earn capital gains on their
insurance by investing the cash value of the policy in stock, bond, or money
market portfolios. The policyholder sustains the investment risk and the
insurance company guarantees a minimum death benefit that is not affected
by any portfolio losses. As in IRAs, earnings from variable life policies
grow tax deferred until distributed. Income is taxed only for the amount
that exceeds the total premiums paid into the policy.
See: Capital Gains; Individual
Retirement Account; Inflation;
Tax Deferred; Whole
Life Insurance
Variable
Rate Demand Note
Note representing borrowings that are payable on demand. Its interest
is tied to a money market rate (e.g., the bank prime rate). The note's
rate is adjusted downward or upward every time the base rate changes.
See: Money Market; Prime
Rate
VD (Volume Deleted)
Note appearing on the consolidated tape indicating that for transactions
of less than 5000 shares only the stock symbol and the trading price will
be displayed. This usually occurs when the tape is running behind because
of heavy trading.
See: Ticker Tape; Volume
Velocity of Money
The amount of times a dollar is spent in a specific time period. Velocity
affects economic activity produced by a given money supply, which includes
bank deposits and cash in circulation. The Federal Reserve Board considers
the velocity of money as a factor in their management of monetary policy.
This is because a rise in velocity may preclude the need to stimulate
an increase in the money supply. Conversely, a decline in velocity may
slow down economic growth.
See: Economic Growth Rate;
Federal Reserve Board; Money
Supply
Venture Capital
Source of financing for start-up companies and new or turnaround ventures
that involve investment risk but offer the prospect for above average
future profits--also called "risk capital". Venture capital
financing supplements other funds that an entrepreneur is able to tap
(or takes the place of loans that conventional financial institutions
are unwilling to risk). Venture capital sources include wealthy individual
investors, subsidiaries of banks, small business investment companies
(SBICs), groups of investment banks and venture capital limited partnerships.
In return for taking an investment risk, venture capitalists are commonly
rewarded with either profits, royalties, preferred stock, capital appreciation
of shares or any combination thereof.
See: Entrepreneur; Investment
Banking; Risk/Reward Ratio;
Venture Capital Limited Partnership
Venture
Capital Limited Partnership
Investment vehicle set up by a brokerage firm or entrepreneurial company
to raise capital for start-up businesses or those in the early stages
of development. In return for taking an investment risk, the partnership
usually takes shares of stock in the company. Venture capital limited
partners receive income from profits the company earns, regardless of
what services or products are sold.
See: Limited Partnership;
Risk/Reward Ratio; Venture
Capital
Versus Purchase
(VSP)
Method of identifying specific shares of securities to be sold for tax
purposes--also called vs. purchase. If versus purchase is not specifically
stated, the IRS deems the securities sold are on a first-in first-out
(FIFO) basis.
See: First In First Out
Vertical Line
Charts
A type of technical charting that displays on one vertical line the low
and high prices of a security or market and a short horizontal mark that
denotes the closing price. Each vertical line represents one day. The
chart shows the trend of a security or a market over a period of days,
weeks, months, or years. Technical analysts determine from these charts
whether a security or a market is frequently closing at the low or high
end of its trading range during a day. This information is useful in discerning
whether the security or a market is weak or strong, and thus, if prices
will decline or advance in the near future.
See: Chartist; Closing
Price; Technical Analysis;
Weak Market
Vertical Spread
Strategy where an investor concurrently buys and sells options on the
same underlying security--also called a price spread. Both options have
identical expiration dates but different strike prices. For instance,
a vertical spread is created by buying an XYZ April 20 call and selling
an XYZ April 25 call. This strategy is used in hopes of profiting as the
difference between the option premium on the two option positions widens
or narrows.
See: Expiration Date; Option
Premium; Options; Spread;
Strike Price; Underlying
Security
Vesting
The process by which an employee becomes entitled to receive employer-contributed
benefits in a qualified retirement plan. The Tax Reform Act of 1986 stipulates
that employees must be vested 100% after five years of employment or at
20% a year in the third year and 100% vested after seven years.
See: Qualified Pension
Plan or Trust
V Formation
A V formation is a technical chart pattern indicating that the security
being charted has bottomed out and is now in a rising (bullish) trend.
An inverse (upside-down) V is indicative of a bearish trend.
See: Bear Market; Bull
Market; Bottom; Chartist;
Technical Analysis
Visible Supply
The total par value of all bond issues scheduled to come to market during
the forthcoming thirty days exclusive of issues with maturities of one
year or less. It is published each day in the Daily Bond Buyer.
See: Daily Bond Buyer; Maturity
Date; Par
VL (Value Line Investment Survey)
An investment advisory service that ranks hundreds of securities for safety
and timeliness. It projects which securities should have the best or worst
price performance over the next year. Moreover, each corporation is assigned
a risk rating. The ratings identify the volatility of a corporation's
stock price behavior compared to the market average. Subscribers to the
service receive weekly write-ups detailing corporations' financial information,
and data such as corporate insider buying and selling decisions and the
percentage of a corporation's shares held by institutions.
See: Fundamental Analysis;
Insider; Institutional
Investor; Rating; Risk/Reward
Ratio; Value Line Equity
Rating Criteria; Volatility
VOL (Volume)
The total number of shares traded in a security or an entire market during
a given period of time. Volume figures are reported daily by exchanges
and a daily average is computed for longer periods. Technical analysts
stress the importance on the amount of volume that occurs in the trading
of a security. A sharp rise in volume is deemed to signal future sharp
rises or falls in price, because it reflects increased interest in a security.
See: Technical Analysis
Volatile
The term describes the size and frequency of fluctuations in the price
of a particular security. A security may be volatile because the company's
outlook is uncertain, there are only a few outstanding shares (see Thin
Market), or many other reasons. When the reasons for the variation have
to do with the particular security and not the market as a whole, return
is measured by alpha. Market-related volatility is measured by beta--also
called systematic risk.
See: Alpha; Outstanding
Stock; Systematic Risk; Thin
Market; Volatility
Volatility
A security, market, or commodity that rises or falls severely in price
within a short time period.
See: Alpha; Systematic
Risk; Volatile
Volume
The total number of shares traded in a security or an entire market during
a given period of time. Volume figures are reported daily by exchanges
and a daily average is computed for longer periods. Technical analysts
stress the importance on the amount of volume that occurs in the trading
of a security. A sharp rise in volume is deemed to signal future sharp
rises or falls in price, because it reflects increased interest in a security.
See: Technical Analysis
Volume Deleted (VD)
Note appearing on the consolidated tape indicating that for transactions
of less than 5000 shares only the stock symbol and the trading price will
be displayed. This usually occurs when the tape is running behind because
of heavy trading.
See: Ticker Tape; Volume
Voting Right
Right to vote in corporate business matters in which they are common shareholder.
This right may be delegated to another person by the shareholder.
See: Cumulative Voting; Proxy;
Statutory Voting
Voting Stock
Shares in a company that give a shareholder voting and proxy rights.
See: Common Stock; Proxy;
Voting Trust Certificate
Voting Trust
A limited-life trust established to center authority of a corporation
to a few individuals, called voting trustees.
See: Voting Trust Certificate
Voting
Trust Certificate (VTC)
Transferable certificate of beneficial interest in a voting trust that
is issued to stockholders in exchange for their common stock. The certificates
represent all the rights of common stock (the shareholder retains rights
to earnings and dividends) but delegates voting rights to the trustees.
The common stock is then registered on the corporation's books in the
names of the trustees. The common purpose for such an arrangement is to
facilitate reorganization of a corporation in financial difficulty by
preventing resistance to management.
See: Reorganization; Voting
Rights; Voting Trust
VSP (Versus Purchase)
Method of identifying specific shares of securities to be sold for tax
purposes--also called vs. purchase. If versus purchase is not specifically
stated, the IRS deems the securities sold are on a first-in first-out
(FIFO) basis.
See: First In First Out
VTC (Voting Trust Certificate)
Transferable certificate of beneficial interest in a voting trust that
is issued to stockholders in exchange for their common stock. The certificates
represent all the rights of common stock (the shareholder retains rights
to earnings and dividends) but delegates voting rights to the trustees.
The common stock is then registered on the corporation's books in the
names of the trustees. The common purpose for such an arrangement is to
facilitate reorganization of a corporation in financial difficulty by
preventing resistance to management.
See: Reorganization; Voting
Rights; Voting Trust
Vulture Funds
A limited partnership that invests in undervalued property and whose goal
is to profit when prices rebound.
See: Limited Partnership;
Undervalued
