What is an Abnormal Return? The benefits expected from a specific portfolio or security beyond its expected return over a certain period of time are termed as abnormal returns. The abnormal return is not the expected return since it exceeds of what was expected. How do Abnormal Returns Happen?  With abnormal returns, you can find the risk-adjusted p...

Understanding Business for Career Development Business is the delivery of a value proposition to a customer, client, or end-user.  In return, the business will receive the type and amount of value required to sustain the business.  Notice that I use the words, amount and type of value. Most of us think of business in terms of money.  Ultimately, bus...

What is the Cynefin Framework? The Cynefin framework, proposed by Snowden and Boone (2007) is the application of contingency thinking to decision-making.  Adept decision-makers should learn how to: Identify the context properly Change their behavior and decisions to match that context, and Prepare their organizations to understand and deal with the ...

What is the Cooling-Off Rule? The cooling off rule is applicable to consumer protection, insurance, and finance. Under consumer protection law, the cooling-off rule is a rule that the Federal Trade Commission (FTC) uses to protect consumers when transacting with sellers. According to the FTC, a buyer has a period of three days to cancel or revoke a ...

What is Adware? As a user of computer devices, when you stress on a web browser, you see advertisements pop up on your screen, this is the work of Adware. Adware is advertising software that displays advertisers to users when they are within an interface or web browser. Adwares are created by developers for the purpose of generating revenue by servi...

What are the Five Disciplines of Senge? The five disciplines of Peter Sense is a model used to identify organizational 'learning disabilities' and use the "Five Disciplines" as antidotes to them.  The five components in the model from Senge are: Systems Thinking. The integrative (fifth) discipline that fuses the other 4 into a coherent body of theor...

What is the Book-to-Market Ratio? The book-to-market ratio is a ratio used to determine the value of a company by comparing its book value to its market value. The market value of a company is derived from the value (price) of its stock in the market while the book value is the accounting value of the company as stated in the balance sheet. The book...

What is a Form 10-K? A Form 10-K summarizes in detail the companys performance in a report for a five-year period. For public companies (or reporting companies), the report is sent to Securities and Exchange Commission (SEC) as part of the companys on-gong reporting and disclosure requirements. It is more comprehensive than annual report, and bears ...

What is a Federal Advisory Council? The Federal advisory council or (FAC) is an organized body that makes consultations with and advises the Federal Reserve Board of Governors on matters pertaining to the banking industry as well as money supply. FAC comprises 12 representatives from the banking industry, each from the 12 Federal Reserve districts. ...

What are Participation Rights? In some cases, the investor will negotiate for the ability to participate with common shareholders in the distribution of proceeds after receiving the liquidation preference. That is, the investor is paid the full liquidation preference, then they participate with common shareholders in receiving a percentage of the re...