Glossary

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Waiting Period (Securities)
Refers to a period of time before something goes into effect. For instance, there is a waiting period between the filing of registration statements and the time when securities may be offered to sale to the public.

Wall Street (General)
A general term used to describe the investment community, such as "Wall Street likes the prospects for that company" or "Wall Street does not like the prospects for that company." Sometimes known as "the Street."

Wall Street (Specific)
Refers to the financial district at the lower end of Manhattan in New York City where the New York and American Stock Exchanges and numerous brokerage company are headquartered.

Wallflower
Refers to stock that has been neglected by research analysts. A stock may be a wallflower if it is too small or has disappointed investors in the past. Wallflower stock tends to trade at low price/earnings ratios. If researchers re-discover the stock and start recommending it, the price and price/earnings ratio may be boosted significantly. Investors purchasing stock at the neglected wallflower stage can reap a high return on investment if the stock is rediscovered. Also known as an orphaned stock and refers to worthless securities. The implication is that certificates of stocks and bonds that have defaulted or gone bankrupts have no other use than as wallpaper. There may, however, be some value in the worthless certificates themselves for collectors of such certificates who prize rare or historically significant certificates. The practice of collecting such certificates is known as scripophily.

Wanted for Cash
A ticker tape announcement that a bidder will pay cash the same day for a specified block of securities. Cash trades are executed for delivery and settlement at the time the transaction is made.

War Chest
A fund of liquid assets (cash) that is set aside by a corporation to pay for a takeover or to defend against a takeover by buying back stock or paying for legal fees to mount a defense or taking other defensive measures.

Warrant
A security entitling the holder to buy a proportionate amount of stock at some specified future date at a specified price, usually one higher than current market. This "warrant" is then traded as a security, the price of which reflects the value of the underlying stock. Warrants are usually issued as a "sweetener" bundled with another class of security to enhance the marketability of the latter.

Warranty
A contract between a purchaser and seller in which the seller documents the conditions under which repairs or other remedies will be made at no cost to the purchaser if problems arise within a specified period of time with the item(s) purchased.

Wash Sale
Refers to the purchase and sale of a security either simultaneously, or within a short period of time. Wash sales, or a wash trade, may be undertaken by one investor or by two or more investors attempting a manipulation, wherein there is a conspiracy to create artificial market activity in order to profit from a rise in the security's price.

Wasting Asset (Fixed)
Refers to a fixed asset, other than land, that has a limited useful life and is therefore subject to depreciation.

Wasting Asset (Securities)
An asset that has a limited life and thus, decreases in value (depreciates) over time. Also applied to consumed assets, such as gas, and termed "depletion." For instance, an option contract is a wasting asset because the chances of a favorable move in the underlying stock diminishes as the contract approaches expiration, therefore reducing the value of the option.

Watch List
A list of securities singled out for special surveillance by a brokerage firm, exchange, or other regulatory body in order to spot irregularities. Companies on a watch list may be there because of takeover rumors or unusually heavy trading.

Watered Stock
Refers to stock representing ownership of overvalued assets. This is a condition that exists in overcapitalized corporations with a total work less than their invested capital. Watered stock may result from gifts of stock, operating losses, excessive stock dividends or inflated accounting values. A company would need to increase assets without increasing outstanding shares; reduce outstanding shares without reducing assets; increase retained earnings; or adjust accounting values of assets or stock in order to fix a watered stock position.

Wave
In Elliott wave theory, a sustained move by a market's price in one direction as determined by the reversal points that initiated and terminated it.

Wave Cycle
An impulse wave followed by a correction wave, the impulse wave being made up of five smaller, numbered waves of alternating direction designated 1, 2, 3, 4 and 5, and the correction wave being composed of 3 smaller alternating waves designated a, b, and c.

Weak Hands
A term referring to people who believe that declining markets will decline further because traders with long positions are not bona fide hedgers and will not accept delivery but will sell before maturity to reduce their risk.

Weak Market
A market with a general declining trend in prices and a preponderance of sellers over buyers.

Wealth Maximization
A strategy of maximizing the value of the shareholder's or owner's investment in a company, measured by the market value of the company's shares.

Wedge
Refers to a technical chart pattern of two converging lines connecting a series of peaks and troughs to form a wedge. The converging lines move in the same direction with one line rising while the other line falls or one line rising or falling while the other line stays horizontal. Rising wedges occur as interruptions of a falling price trend and falling wedges occur as temporary interruptions of upward price rallies.

Weighted Industry Index
An index where the importance of each stock is related to its market capitalization.

When Issued
A short form for the phrase "when, as, and if issued." Refers to a transaction made conditionally because an authorized security has not yet been issued. In a newspaper listing a 'WI' is placed beside the price of such a security. New issues of stocks and bonds, stock that has split and Treasury securities are all traded on a 'when issued' basis.

Whipsaw
Losing money on both sides of a price swing.

Whipsawed
Refers to making losing trades as prices rise and fall, or used in technical analysis to refer to misleading signals in chart trends of markets or specific securities. A trader has been whipsawed if they have bought just before prices fall or sold just before prices rise.

Whisper Stock
Refers to stock that is rumored to be a takeover target. Whisper stocks may trade in heavier than usual volume and investing in them is risky because the takeover rumor may be inaccurate. Arbitrageurs and speculators may buy shares in whisper stock because they may make huge amounts of money if the whispers are true and a takeover is announced.

Whistle Blower
Refers to an employee or other individual with inside knowledge of wrongdoing inside a government agency or company. Employees are supposed to be protected from reprisals by law. Whistle blowers providing Revenue Canada with information about illegal insider trading or other illegal activities that leads to a conviction may qualify for a percentage bonus (or bounty) based on what money is collected by the government.

White Knight
Refers to a friendly acquirer, sought by the target of an unfriendly takeover.

White Sheets
Refers to a list of prices published by the National Quotation Bureau for market makers in over-the-counter stocks traded in Chicago, Los Angeles and San Francisco.

White-shoe Firm
An anachronistic term once used to describe some brokers and dealers as 'upper-crust' and above such practices as participating in hostile takeovers. The term comes from the 1950s in which members of elite fraternities and clubs at Ivy League colleges wore white buck shoes.

Whitemail
An anti-takeover strategy whereby a target company sells a large amount of stock to a friendly party at below-market prices. This technique is intended to keep existing management in control by putting a potential raider in the position of needing to buy a sizable amount of stock at inflated prices in order to get control.

Wholly Owned Subsidiary
Term used for a company whose common stock is virtually 100% owned by the parent company.

Wide Opening
Refers to an unusually large spread between the bid and asked prices of a security at the opening of a trading session.

Widow and Orphan Stock
Refers to stock that pays high dividends and is very safe. Widow and orphans stock is often associated with non-cyclical businesses and usually has a low beta coefficient.

Wildcards
Characters in a quote symbol or Dos file name that indicate an undefined, but categorized, value.

Williams' R
Overbought and oversold indicator that is used to determine market entry and exit points.

Wilshire 5000 Equity Index
Refers to a market value-weighted index of about 6,500 U.S. based equities traded on the American Stock Exchange, the New York Stock Exchange and the NASDAQ stock market. The Wilshire 5000 is prepared by Wilshire Associates, Inc. of California and is widely followed as an indicator of the broad trend in stock prices.

Windfall Profits Tax
A tax on profits that results from a sudden windfall to a particular industry or company.

Window
Either the cashier department of a brokerage firm where delivery and settlement of securities transactions take place, or a limited time during which an opportunity should be exercised or it will be lost (often referred to as a window of opportunity).

Window Dressing (Securities)
A trading activity that occurs near the end of a quarter or fiscal year end that is intended to dress up a portfolio so that it can be presented to clients or shareholders in a good light. For instance, a fund manager may sell losing positions in order to display only positions that have gained in value in their portfolio.

Winnipeg Commodity Exchange (WSE)
Incorporated in 1903, the WSE is Canada's only agricultural futures and options exchange. The WSE conducts the world's only futures market for flaxseed, rye and canola. The WSE also trades feed grades of wheat, oats and barley.

Wire and Order
Refers to the operating department of a brokerage firm that receives customers' orders from the registered representative and transmits them to the exchange floor where a floor ticket is prepared, or directly to the appropriate registered representatives.

Wire Room
Refers to the operating department of a brokerage firm that receives customers' orders from the registered representative and transmits them to the exchange floor where a floor ticket is prepared, or directly to the appropriate registered representatives.

Witching Day
A day on which two or more related classes of options and futures expire.

Withdrawal Plan
The ability to establish automatic periodic mutual fund redemptions and have proceeds mailed directly to the investor.

Working Capital
In a narrow sense, defined as the difference between a firm's current assets and its current liabilities. More broadly, working capital encompasses both a firm's current assets and liabilities, and working-capital management is concerned with the management of current assets and liabilities.

Working Capital Ratio
Current assets of a company divided by its current liabilities. This is a measure of a company's liquidity.

Wrap Account
A type of fully discretionary account in which a client has given specific written authorization to a partner, director or qualified portfolio manager of an investment dealer to select securities and execute trades for him or her. A single annual fee, based on the account's total assets, is charged instead of commissions and service charges being levied separately for each transaction. The account is then managed separately from all other wrap accounts, but is kept consistent with a model portfolio suitable to clients with similar objectives. This is also known as a wrap fee program.

Writer
An individual who sells an option.

W-Type Bottom
A double bottom where the price or indicator chart has the appearance of a W.

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