Puke point

By Carmel Lobello via theweek.com   Article

17 weird finance buzzwords, explained

“… like any industry, the finance world is … filled with lively slang words and phrases, coined over the years to describe practices and trends unique to that world. Here are a few of our favorites. …

2. Big ugliesBig, older companies, usually in ‘dirty’ industrial sectors like mining or steel. Though they can be solid investments with good, steady returns, many investors ignore them for ‘cleaner,’ trendier stocks. …

4. Cockroach theory: The theory that when a company reports bad news to the public, there’s usually a lot more bad news behind the scenes that may come out later. It can also refer to industry-wide suspicions — if one subprime lender is going bankrupt (like New Century Financial was in 2007), other subprime lenders might have similar problems behind the scenes.

5. Cookie jar accounting: An accounting practice in which a company stores up funds during good times to dip into during bad times. Because it effectively misleads investors — making them think goals are being met even when the company is losing footing — this practice is forbidden by the SEC. …

8. Jennifer Lopez: An informal term that describes what happens when a security reaches a low, then gradually starts to go up again. On a graph, it looks like a curve at the bottom, which is why investors named it after the admirably round-bottomed singer.

9. Puke point: Puking, in this case, is slang for selling an asset as the value is plummeting. The “puke point” is the point at which the investor can no longer stomach the losses, and decides to sell the asset, regardless of its steeply falling price.”


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