Buy Limit Order

What Does it Mean?
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An order to purchase a security at or below a specified price. A buy limit order allows traders and investors to specify the price that they are willing to pay for a security, such as a stock. By using a buy limit order, the investor is guaranteed to pay that price or better, meaning that he or she will pay the specified price or less for the purchase of the security.

While the price is guaranteed, the filling of the order is not. In other words, if the specified price is never met, the order will not be filled and the investor may miss out on the trading opportunity.

Investopedia Says:
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A buy limit order ensures that negative slippage will not occur - the buyer will not get a worse price than he or she expects. Buy limit orders provide investors and traders with a means of precisely entering a position. For example, a buy limit order can be put in for $2.40 when a stock is trading at $2.45. If the price dips to $2.40, the order will automatically be executed.

Tax Lien Foreclosure

What Does it Mean?
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The sale of a property resulting from the property owner's failure to pay tax liabilities. A tax lien foreclosure occurs when the property owner has not paid the required taxes, including property taxes and federal and state income taxes. A statutory lien is first placed against the property of the person who has failed to pay taxes. The government that is owed the taxes (for example, the federal government in the case of unpaid federal income, self-employment, gift or estate taxes) will move to repossess the property in an attempt to recover the debt.

Investopedia Says:
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Properties that are foreclosed due to nonpayment of taxes are deemed tax lien foreclosures. Tax liens can be specific liens against specific property, such as with property taxes and special assessment liens. Tax liens may also be general liens against all property of the defaulting taxpayer, such as with federal or state income tax liens. Tax laws prevent the the former resident of the property (who failed to pay taxes) from bidding at the auction.

Death Star IPO

What Does it Mean?
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A company's highly anticipated initial public offering (IPO) that becomes a blockbuster with investors. The Death Star IPO is a reference to the DS-1 Orbital Battle Station, also more popularly know as the "Death Star," from the movie "Star Wars." This planetary weapon had the ability to destroy entire planets with a single beam, resulting in a massive explosion. In the stock market, stocks that have the ability to explode out of the gate are usually highly anticipated tech stocks, although stocks from other sectors can also fit the bill.

Investopedia Says:
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Broadly speaking, to be considered a Death Star IPO, the IPO would have to be a multi-billion dollar offering that is also in very high demand with investors. Some examples of Death Star IPOs include Google's IPO in 2004 and Yahoo! in 1996. Both IPOs were highly anticipated events and both stocks exploded on stock markets once the shares became publicly available.

The Celler-Kefauver Act

What Does it Mean?
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A 1950 refinement of previous antitrust legislation dealing primarily with mergers. The Celler-Kefauver Act targets mergers where companies purchase suppliers, and occasionally competitor's suppliers, in order to secure production. The Clayton Act already contained language addressing horizontal mergers, but the Celler-Kefauver Act added vertical mergers and conglomerate mergers to the growing list of possible antitrust violations.

Investopedia Says:
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Vertical and conglomerate mergers aren't illegal under the Celler-Kefauver Act unless they significantly reduce competition. Similar to other antitrust acts, actions that reduce competition aren't always easy to classify under Celler-Kefauver. Both types of mergers raise the barriers for entry by making competitors internalize more production to match the cost savings that come from economies of scale. However, as long as there is at least a couple other companies capable of keeping up, barriers can be raised as high as the duo or trio can handle.

Tontine

What Does it Mean?
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A system for raising capital in which individuals pay into a common pool of money, and then receive a dividend based upon their share and the performance of investments made with the pooled money. The principle invested in the tontine is never paid back to the investor; rather the investor receives dividends until death. If a "shareholder" dies, his or her shares are divided up among the surviving investors

Investopedia Says:
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This system is attributed to Lorenzo de Tonti, a 17th century Italian banker. Government-sponsored tontines paid dividends while investors were alive, but once all the investors died the government would absorb all the remaining capital. Tontines were used in the United States as a way of increasing the sale of life insurance in the 19th century, but have fallen out of use and are illegal in many parts of the country.

Upstairs Deal

What Does it Mean?
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A business agreement that is made by upper management, and is generally unknown to lower-level employees until it is publicly announced. The deal is referred to as an "upstairs deal" because executives typically have their offices in the higher floors of an office building. In mergers and acquisitions, an upstairs deal between two companies is more likely to result in a friendly takeover, as opposed to a hostile takeover.

Investopedia Says:
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Keeping word of a potential merger quiet allows executives to operate with a reduced risk of outside parties profiting from the deal by driving up share prices. Once a takeover offer is announced, share prices will react by either moving up or down to the indicated target price. For example, a deal in which a company tenders an offer of $15 per share with shares currently trading at $10 per share will likely result, when announced, in shares adjusting to $15.
Since Black Monday, a number of protective mechanisms have been built into the market to prevent panic selling, such as trading curbs and circuit breakers

Black Monday

What Does it Mean?
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October 19, 1987, when the Dow Jones Industrial Average (DJIA) lost almost 22% in a single day. That event marked the beginning of a global stock market decline, making Black Monday one of the most notorious days in recent financial history. By the end of the month, most of the major exchanges had dropped more than 20%.

Investopedia Says:
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Interestingly enough, the cause of the massive drop cannot be attributed to any single news event because no major news event was released on the weekend preceding the crash. While there are many theories that attempt to explain why the crash happened, most agree that mass panic caused the crash to escalate.

Since Black Monday, a number of protective mechanisms have been built into the market to prevent panic selling, such as trading curbs and circuit breakers