The worth of a company as set by the stock market. It is calculated by multiplying the total number of shares on issue by the price per share.
Market paricipatns are those companies that meet the ASX’s requirements. They are more commonly refered to as Stockbroking organisations and there are currently 80 partipants throughout Australia.
In the context of the Australian share market, Market Price represents the last reported price to buy or sell a security on the open market. It is the closing price on SEATS, excluding special crossings; overnight sales and exchange traded option exercises. Alternatively, it is the highest price, which a buyer willing, but not compelled to buy would pay, and the lowest a seller, willing but not compelled to sell, would accept.
The current value of an item or security, as opposed to its book value.
Marketable Parcel, is based on the definition in ASX's Business Rules in relation to:
(a) Equity Securities and redeemable preference shares with a fixed and certain date for redemption, but not rights to subscribe for Equity Securities, a parcel of securities of not less than $500 based on:
(i) the closing price on SEATS, if the equity securities are quoted; or
(ii) the price paid on issue if the equity securities are unquoted.
(b) Rights to subscribe for Equity Securities, a parcel of rights which, if taken up in full, would result in a parcel of Equity Securities which would not be less than $500 based on:
(i) the closing price on SEATS of the Equity Securities at the time of purchase of the rights, if the Equity Securities are quoted; or
(ii) the total application moneys payable in relation to the exercise of the rights if the Equity Securities are unquoted.
(c) Loan Securities other than redeemable preference shares with a fixed and certain date for redemption, 1 security with a face value of not less than $100.
A notation placed upon a transfer indicating that there is a share certificate held by the Share Registry to support the transfer.
A number used in tracking bonds and marking certificates.
The redemption date; the date on which a fixed interest security is due to be repaid by its Issuer.
An Investor. The register of Investors is called the Register of Members.
A document under earlier legislation drawn up on creation of a company, setting out its initial objectives, capital, name and address. As this forms part of a company’s constitution, any changes need to adhere to the Corporations Act 2001.
The joining of two or more identical shareholdings.
A form of corporate restructuring in which two (or more) companies combine all or part of their operations. Unlike takeovers, mergers are usually negotiated by the management of the companies concerned. A merger usually implies that the companies (or operations) are roughly equivalent in size.
The Australian Prudential Regulation Authority requires that each insurer maintain sufficient capital to enable its insurance obligations to be met under a wide range of circumstances.
A term to describe Managed Investments in the US and are similar to unit trusts in Australia.
The National Guarantee Fund provides compensation to investors who have claims arising from dealings with ASX Participating Companies.
ASX maintains investor confidence in the integrity of its markets by regulating the conduct of market participants and monitoring market activity for any irregularities.
The Insolvency and Trustee Service ("ITSA") is responsible for maintaining an index containing information on proceedings and administrations under the Bankruptcy Act, 1996. This index is called the National Personal Insolvency index.
If it is a voluntary bankruptcy (debtor's petition), an extract from the National Personal Insolvency Index (NPII), is sufficent proof to show that the person is bankrupt, and who the trustee is.
The total assets of a company (current assets plus fixed assets) less its current liabilities.
Current assets minus current liabilities; also defined as working capital.
The gross profit of a company (total turnover of products sold less costs to purchase or manufacture) less all other expenses. When net profit figures are quoted, the author usually makes it clear whether the figure is before or after tax. In company accounts, the word 'net' is often dropped, so that you simply have 'Profit before tax' and Profit after tax'.
The net worth of a share, the theoretical value of the net assets attributable to each ordinary share on issue. It is calculated by dividing the estimated value of the company (total assets less liabilities) by the number of shares on issue. A company can have poor earnings per share rate, but still have solid asset backing.
Recently issued shares are quoted as 'new' when they do not rank equally with existing shares in terms of dividends.
Rights (entitlements) that have not been exercised (paid for) by the Investor.
A register of issued rights jointly maintained by the Issuer and CHESS to enable rights trading to be brought in line with fixed settlement and DvP concepts.
No liability companies are public companies that have no statutory or contractual right to recover unpaid calls on partly paid shares. Such companies have ‘No Liability’ or ‘NL’ in their name. The activities of a no liability company must be confined to mining.
Indicates whether the Investor requires none, summary or full annual reports to be sent each year.
A person appointed to vote at a meeting on behalf of another Investor.
Non Broker Participant (NBP) A party other than the Australian Stock Exchange (ASX) member broker that has been admitted to be a CHESS participant.
The party may be a:
A class of security that do not rank equally with ordinary shares.
A rights offer that may only be taken up or forfeited, and cannot be traded on the market.
A settlement in which the Clearing House gives effect to the delivery of securities but does not give effect to a corresponding payment. For example, this may occur when parties settle the payment side of a trade, externally to the Clearing House and transfer the required uncertificated securities to the Clearing House.
A loan made to a company at a fixed rate of interest with the right to be either redeemed (i.e. repaid by the company) for cash or converted into ordinary shares at a predetermined date or within a certain period.
A noting of information against an Investor indicating some special circumstance. For example, a power of attorney, notification of death of a beneficiary, noting of incorporation for companies.
In the stock market, offer means that a seller is willing to sell a share at a given price.
In relation to a Takeover Bid, the offer period is the period for which offers under the bid remain open; however in relation to a Scheme, the offer period is from the date an announcement of intention to propose a Scheme is first received by the Exchange until the date on which the Scheme is effected.
An abbreviated prospectus for a new security listing. Delivered to individuals and brokerage houses, these documents are issued to arouse interest in the new issue.
Offeror can be:
The list of securities which have obtained a formal listing on the main market of an exchange.
The name for a copy of the common seal to be used outside the State or Territory where the common seal is kept. It gives an exact facsimile of the common seal with the addition on its face of the name of every place where it is to be used.
An Off-market Buyback is when an Issuer wishes to buy back it’s own shares from Investors, but will approach them personally (by mailing) as opposed to making an announcement to the market (On-market Buyback). An Issuer will decide to buy back shares in an attempt to increase share price and in some cases to reduce the number of small Investors on the Register.
When shares are bought back by the client they are cancelled and no longer exist, therefore reducing the overall number of shares on the company’s register.
Relating to a transaction, such as moving securities from one holding to another without using a broker outside a formal market. Off-market transactions are conducted through negotiation rather than an auction system.
An On-market Buyback relates to the Issuer taking the Buyback offer to the market, as opposed to an Off-market Buyback, which only approaches the existing Investors.
Electronic transfer of stock from one holder to another through a Stock Broker. In this instance the Stock Broker locates a buyer or seller through the Stock Market according to their clients instructions.
A security, which gives its holder the right but not the obligation to acquire a share in a company at a specified price on a stipulated date or, sometimes, at any time up to a maximum date. An option which is not exercised by the latest possible exercise date lapses and becomes worthless.
Options are usually transferable and can be traded rather than used as a means to obtain the underlying security. An option to buy is a call option. An option to sell is put option. One to buy or sell is a double option.
A subsidiary of ASX, this is the clearing house for exchange traded options. OCH guarantees performance of contracts and is responsible for daily margining, exercise notices and monitoring the financial status of brokers.
The most common class of security, which carry voting rights and entitlement to dividends. Ordinary shares form the bulk of a company’s capital. All companies listed on the stock exchange have to have ordinary shares. They may be fully paid or contributing.
If the company is wound up (liquidated), ordinary Investors generally rank behind preference Investors and secured creditors, including debenture holders. They also rank behind secured creditors for dividend payments.
When the exercise price of an option is above the current market price of the underlying asset
Overseas Dividend Reinvestment Plan (OSDP) Overseas Dividend Reinvestment Plan is similar to a Dividend Reinvestment Plan (DRP) but is offered by Issuers that have Investors on registers outside Australia, such as United Kingdom or New Zealand. In such cases the Investors are able to obtain dividend payments in foreign currency and or reinvest in the normal way as per DRP.
This is a situation in which the value of applications received for a new share issue, exceed the amount available to be allocated. In share issues, oversubscriptions are not usually accepted and allotments may be scaled back and are made at the discretion of the company. In fixed interest issues it is common for a specific level of oversubscriptions to be accepted.