Glossary of Terms

The information presented here is not intended as financial, investment, tax or legal advice and is provided for educational purposes only.
An option to purchase or sell the underlying at a given price and time or at a series of prices and times outlined in the warrant agreement. A warrant differs from a put or call option in that it is ordinarily issued for a period in excess of one year. Ordinarily, exercise of a common stock warrant sold by the issuer of the underling increases the number of shares of stock outstanding, whereas a call or a covered warrant is an option on shares already outstanding.
Wash Sale
A wash sale occurs if you sell your fund shares at a loss and, 30 days before, after or on the day of that sale, you purchase additional shares in the same fund.
Weighted Average Maturity (WAM)
The average time until maturity for securities in a portfolio, weighted in proportion to the dollar amount that is invested in the portfolio. WAM measures the sensitivity of fixed-income portfolios to interest rate changes. Portfolios with longer WAMs are more sensitive to changes in interest rates; shorter WAMs indicate less sensitivity.
When-Issued Securities
Refers to a transaction made conditionally because a security, although authorized to be issued, has not yet been issued. New issues of stock and bonds, stocks that have split, and Treasury securities are traded on a when-issued basis.
A legal document in which a person, the testator, names one or more persons to manage his estate and facilitate the transfer of his property after his death.
Withdrawal Plan
An arrangement in which an investor, at his request, receives periodic payments from his mutual fund holdings. Most commonly, withdrawal plans are used to provide income during retirement and to pay for periodic expenses, such as a child's college expenses.
Money deducted from a principal amount to pay income tax.