Glossary

Valuation Fee
Fee which may be charged if the lender seeks to cover the cost of valuing the property taken as security for the loan.

Value Added Tax
A term used in some countries for a Goods and Services Tax.

Value Date
The trading date of the instrument being used to hedge an underlying exposure. This date is always before/the same as the underlying exposure's maturity.

Value Investor
One who seeks to buy shares when they are underpriced and to take profits when they appear overvalued. The Price/Earnings Ratio is a key valuation measure.

Variance
A measure of dispersion of returns on investments based on deviations from the average or mean value.

Vega
The ratio of a change in the option price to a small change in the option volatility. (See also Theta).

Vendor
A seller of an asset. In real estate transactions the vendor is the person disposing of the property.

Vendor Shares
Shares that are issued in payment for assets sold to a company at the time of a float.

Venture Capital
Capital which is subject to more than a normal degree of risk, usually associated with a new business or venture and particularly in relation to new technology projects. Also called Risk Capital. (See also Development Capital).

Vertical Integration
The acquisition by a company operating in one market of another company which is complementary to its existing business (as a supplier or user of product) but which operates in another market eg. a newspaper publishing company acquiring a paper manufacturer. (See also Horizontal Integration).

Vertical Spread
In options markets, a spread in which one option is bought and one option is sold, where both options are of the same type, have the same underlying security, and expire at the same time. The options differ only by their exercise prices.

Vesting
In relation to superannuation, the inclusion of all or part of the employer contribution in the benefit payable to a member who leaves his or her employment (eg. resigns) before being eligible for retirement benefits. (See also Full Vesting, Partial Vesting).

Volatility
The extent of fluctuation in share prices, exchange rates, interest rates, etc. The higher the volatility, the less certain an investor is of return, and hence volatility is one measure of risk.

Volume
The aggregate number or value of securities traded during a given period.

Voting Right
A right enjoyed by a shareholder to participate in the affairs of the company by voting at its annual meeting or other policy making forum. (See also Corporate Governance, Proxy).

A, B, C, D, E, F, G, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, V, W, X, Y, Z.