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Profit and Loss Sharing (also called PLS or participatory banking) refers to Sharia-compliant forms of equity financing such as mudarabah and musharakah. These mechanisms comply with the religious prohibition on interest on loans that most Muslims subscribe to. Mudarabah (مضاربة) refers to "trustee finance" or passive partnership contract, while Musharakah (مشاركة or مشركة) refers to equ

In economics, the profit motive is the motivation of firms that operate so as to maximize their profits. Mainstream microeconomic theory posits that the ultimate goal of a business is "to make money" - not in the sense of increasing the firm's stock of means of payment (which is usually kept to a necessary minimum because means of payment incur costs, i.e. interest or foregone yields), b

A promissory note, sometimes referred to as a note payable, is a financial instrument in which one party (the maker or issuer) promises in writing to pay a determinate sum of money to another (the payee), subject to any terms and conditions specified within the document.

Proof of space (PoS) is a type of consensus algorithm achieved by demonstrating one's legitimate interest in a service (such as sending an email) by allocating a non-trivial amount of memory or disk space to solve a challenge presented by the service provider. The concept was formulated in 2013 by Dziembowski et al. and (with a different formulation) by Ateniese et al..

Proof-of-stake (PoS) protocols are a class of consensus mechanisms for blockchains that work by selecting validators in proportion to their quantity of holdings in the associated cryptocurrency. This is done to avoid the computational cost of proof-of-work (PoW) schemes. The first functioning use of PoS for cryptocurrency was Peercoin in 2012, although its scheme, on the surface, still r

A property derivative is a financial derivative whose value is derived from the value of an underlying real estate asset. In practice, because individual real estate assets fall victim to market inefficiencies and are hard to accurately price, property derivative contracts are typically written based on a real estate property index. In turn, the real estate property index attempts to a

Proprietary trading (also known as prop trading) occurs when a trader trades stocks, bonds, currencies, commodities, their derivatives, or other financial instruments with the firm's own money (instead of using customer funds) to make a profit for itself.

A prospectus, in finance, is a disclosure document that describes a financial security for potential buyers. It commonly provides investors with material information about mutual funds, stocks, bonds and other investments, such as a description of the company's business, financial statements, biographies of officers and directors, detailed information about their compensation, any litiga

In the context of stock markets, the public float or free float represents the portion of shares of a corporation that are in the hands of public investors as opposed to shares held by promoters, company officers, controlling interest investors, or governments. This number is sometimes seen as a better way of calculating market capitalization, because it provides a more accurate reflecti

The public market equivalent (PME) is a collection of performance measures developed to assess private equity funds and to overcome the limitations of the internal rate of return and multiple on invested capital measurements. While the calculations differ, they all attempt to measure the return from deploying a private equity fund's cash flows into a stock market index.

A public offering is the offering of securities of a company or a similar corporation to the public. Generally, the securities are to be publicly listed. In most jurisdictions, a public offering requires the issuing company to publish a prospectus detailing the terms and rights attached to the offered security, as well as information on the company itself and its finances. Many other reg

A public–private partnership (PPP, 3P, or P3) is a long-term arrangement between a government and private sector institutions. Typically, it involves private capital financing government projects and services up-front, and then drawing revenues from taxpayers and/or users for profit over the course of the PPP contract. Public–private partnerships have been implemented in multiple countri

Publicly traded private equity, also known as publicly quoted private equity or publicly listed private equity, is an investment firm or investment vehicle, which makes investments conforming to one of the various private equity strategies, and is listed on a public stock exchange.

Pump and dump (P&D) is a form of securities fraud that involves artificially inflating the price of an owned stock through false and misleading positive statements (pump), in order to sell the cheaply purchased stock at a higher price (dump).

pump.fun (commonly referred to as Pump) is a cryptocurrency launchpad for the Solana blockchain that enables users to create tokens and trade them immediately on the platform, as well as to launch them onto decentralized exchanges, a process known as "graduation". The platform was launched on January 19, 2024, by Noah Tweedale, Alon Cohen and Dylan Kerler.

Purchasing power parity (PPP) is a measure of the price of specific goods in different countries and is used to compare the absolute purchasing power of the countries' currencies. PPP is effectively the ratio of the price of a market basket at one location divided by the price of the basket of goods at a different location. The PPP inflation and exchange rate may differ from the market e

In finance, a put or put option is a derivative instrument in financial markets that gives the holder (i.e. the purchaser of the put option) the right to sell an asset (the underlying), at a specified price (the strike), by (or on) a specified date (the expiry or maturity) to the writer (i.e. seller) of the put. The purchase of a put option is interpreted as a negative sentiment about th

In financial mathematics, the put–call parity defines a relationship between the price of a European call option and European put option, both with the identical strike price and expiry, namely that a portfolio of a long call option and a short put option is equivalent to (and hence has the same value as) a single forward contract at this strike price and expiry. This is because if the p

In finance the put/call ratio (or put-call ratio, PCR) is a technical indicator demonstrating investor sentiment. The ratio represents a proportion between all the put options and all the call options purchased on any given day. The put/call ratio can be calculated for any individual stock, as well as for any index, or can be aggregated. For example, Cboe volume and put/call ratio data i

Puttable bond (put bond, putable or retractable bond) is a bond with an embedded put option. The holder of the puttable bond has the right, but not the obligation, to demand early repayment of the principal. The put option is exercisable on one or more specified dates.

Qardh al-hasan (Arabic: قرض الحسن, transl. benevolent lending) is an Islamic concept of interest-free lending. It is based on the principle of helping others without expecting a financial gain. However some Ulama deem it a form of interest-free loan (fungible, marketable wealth) that is extended by a lender to a borrower on the basis of benevolence (ihsan). Al-qardh, from a shari’a point

The Qatari riyal (Arabic: ريال قطري; sign: QR in Latin, ر.ق in Arabic; ISO code: QAR) is the official currency of the State of Qatar. Each riyal, the base unit, is divided into 100 dirhams (Arabic: درهم).

The qirad (also known as Muqaradah by Hanafi and Hanbali scholars) was one of the basic financial instruments of the medieval Islamic world. It was an arrangement between one or more investors and an agent where the investors entrusted capital to an agent who then traded with it in hopes of making profit. Both parties then received a previously settled portion of the profit. The agent

Quality investing is an investment strategy based on a set of clearly defined fundamental criteria that seeks to identify companies with outstanding quality characteristics. The quality assessment is made based on soft (e.g. management credibility) and hard criteria (e.g. balance sheet stability). Quality investing supports best overall rather than best-in-class approach.

A quantitative fund is an investment fund that relies on systematic, data-driven methods, such as mathematical models, statistical techniques, AI, and machine learning, to make investment decisions, rather than fundamental human analysis. These funds are often referred to as systematic funds, and many employ factor investing strategies such as value and momentum, which are widely studied

Quantitative tightening (QT) is a contractionary monetary policy tool applied by central banks to decrease the amount of liquidity or money supply in the economy. A central bank implements quantitative tightening by reducing the financial assets it holds on its balance sheet by selling them into the financial markets, which decreases asset prices and raises interest rates. QT is the re

The quantity theory of money (QTM) is a hypothesis within monetary economics which states that the general price level of goods and services is directly proportional to the amount of money in circulation (i.e., the money supply), and that the causality runs from money to prices. This implies that the theory potentially explains inflation. It originated in the 16th century and has been pr

In finance, the quick ratio, also known as the acid-test ratio, is a liquidity ratio that measures the ability of a company to use near-cash assets (or 'quick' assets) to extinguish or retire current liabilities immediately. It is the ratio between quick assets and current liabilities.

In finance, quote stuffing refers to a form of market manipulation employed by high-frequency traders (HFT) that involves quickly entering and withdrawing a large number of orders in an attempt to flood the market. This can create confusion in the market and trading opportunities for high-speed algorithmic traders. The term is relatively new to the financial market lexicon and was coined

Raast (Urdu: راست; lit. 'direct') is Pakistan's first instant payment system operated by the State Bank of Pakistan (SBP). It operates using the state-of-the-art Pakistan Faster Payment System (PFPS), facilitating real-time settlement of small-value retail payments, including inter-bank peer-to-peer (P2P) and person-to-merchant (P2M) transactions.

In finance, a Rainbow option is a derivative whose payoff depends on multiple underlying risky assets. Each underlying asset is referred to as a color of the rainbow. It contrasts with a simple option that is exposed to one source of uncertainty, such as the price of underlying asset.

In economics and finance, the profit rate is the relative profitability of an investment project, a capitalist enterprise or a whole capitalist economy. It is similar to the concept of rate of return on investment. Scholarship has shown that the profit rate has fallen since 1945, especially after the Great Recession.

In finance, return is a profit on an investment. It comprises any change in value of the investment, and/or cash flows (or securities, or other investments) which the investor receives from that investment over a specified time period, such as interest payments, coupons, cash dividends and stock dividends. It may be measured either in absolute terms (e.g., dollars) or as a percentage of

A ratio spread or frontspread is a multi-leg options position. Like a vertical, the ratio spread involves buying and selling options on the same underlying security with different strike prices and the same expiration date. In this spread, the number of option contracts sold is not equal to a number of contracts bought. An unequal number of options contracts gives this spread certain u

In financial economics, rational pricing is the assumption that asset pricing models must reflect the arbitrage-free price of the asset

Raymond Thomas Dalio (born August 8, 1949) is an American billionaire investor and founder of Bridgewater Associates, one of the world's largest hedge funds.

This article is a list of all notable reaction to James Tobin's 1972 proposal of what is now known as the Tobin tax.

The real bills doctrine says that as long as bankers lend to businessmen only against the security (collateral) of short-term 30-, 60-, or 90-day commercial paper representing claims to real goods in the process of production, the loans will be just sufficient to finance the production of goods. The doctrine seeks to have real output determine its own means of purchase without affecting

A real estate derivative is a financial instrument whose value is based on the price of real estate. The core uses for real estate derivatives are: hedging positions, pre-investing assets and re-allocating a portfolio. The major products within real estate derivatives are: swaps, futures contracts, options (calls and puts) and structured products. Each of these products can use a differ

Real options valuation, also often termed real options analysis, (ROV or ROA) applies option valuation techniques to capital budgeting decisions. A real option itself, is the right—but not the obligation—to undertake certain business initiatives, such as deferring, abandoning, expanding, staging, or contracting a capital investment project. For example, real options valuation could exami

In accounting, reconciliation is the process of ensuring that two sets of records (usually the balances of two accounts) are in agreement. It is a general practice for businesses to create their balance sheet at the end of the financial year as it denotes the state of finances for that period. Reconciliation is used to ensure that the money leaving an account matches the actual money spe

In finance, recovery swaps, recovery locks, or recovery default swaps (RDS) are derivative contracts related to credit default swaps, and reference a bond issuance as its underlying. They are designed to provide a hedge against the uncertainty of recovery in default.

Reference re Pan‑Canadian Securities Regulation, 2018 SCC 48 is a landmark decision of the Supreme Court of Canada, dealing with the Canadian doctrine of cooperative federalism and how it intersects with the power of the Parliament of Canada over trade and commerce, as well as discussing the nature of parliamentary sovereignty in Canada.

Reference Re Securities Act [2011] 3 S.C.R. 837, 2011 SCC 66 is a landmark opinion of the Supreme Court of Canada to a reference question posed on the extent of the ability of the Parliament of Canada to use its trade and commerce power.

A Refinitiv Instrument Code, previously Reuters Instrument Code (RIC), is a ticker-like code used by Refinitiv to identify financial instruments and indices. The codes are used for looking up information on various Refinitiv financial information networks (such as Refinitiv Real Time) and appear to have developed from the Quotron service purchased in the 1980s.

Regulation S-K is a prescribed regulation under the US Securities Act of 1933 that lays out reporting requirements for various SEC filings used by public companies. Companies are also often called issuers (issuing or contemplating issuing shares), filers (entities that must file reports with the SEC) or registrants (entities that must register (usually shares) with the SEC).

Remgro Limited is a South African investment holding company, based in Stellenbosch.

Remitly is an American online remittance service based in Seattle, United States that offers international money transfers to over 170 countries. It was founded in 2011 by Matthew Oppenheimer, Josh Hug, and Shivaas Gulati and became publicly traded on the Nasdaq exchange in September 2021.

A renewable energy derivative is based on a new method of securitization, which is a structured finance process that pools and repackages cash-flow-producing financial assets into securities which are then sold to investors. The term "securitization" is derived from the fact that securities are used to obtain funds from investors.

Renting, also known as hiring or letting, is an agreement where a payment is made for the use of a good, service or property owned by another over a fixed period of time. Typically a written agreement is signed to establish the roles and expectations of both the tenant and landlord. There are many different types; a rental agreement tends to refer to short-term rental, whereas lease ref

In mathematical finance, a replicating portfolio for a given asset or series of cash flows is a portfolio of assets with the same properties (especially cash flows). This is meant in two distinct senses: static replication, where the portfolio has the same cash flows as the reference asset (and no changes need to be made to maintain this), and dynamic replication, where the portfolio doe

A repurchase agreement, also known as a repo, RP, or sale and repurchase agreement, is a form of secured short-term borrowing, usually, though not always, using government securities as collateral. A contracting party sells a security to a lender and, by agreement between the two parties, repurchases the security back shortly afterwards, at a slightly higher contracted price. The differe

Reputational damage is the loss to financial capital, social capital and/or market share resulting from damage to an organization's reputation. This is often measured in lost revenue, increased operating, capital or regulatory costs, or destruction of shareholder value. Ethics violations, safety issues, security issues, a lack of sustainability, poor quality, and lack of or unethical inn

Reserve requirements are central bank regulations that set the minimum amount that a commercial bank must hold in liquid assets. This minimum amount, commonly referred to as the commercial bank's reserve, is generally determined by the central bank on the basis of a specified proportion of deposit liabilities of the bank. This rate is commonly referred to as the cash reserve ratio or sh

Residential mortgage-backed security (RMBS) are a type of mortgage-backed security backed by residential real estate mortgages.

Restricted stock, also known as restricted securities, is stock of a company that is not fully transferable (from the stock-issuing company to the person receiving the stock award) until certain conditions (restrictions) have been met. Upon satisfaction of those conditions, the stock is no longer restricted, and becomes transferable to the person holding the award. Restricted stock is of

Retail banking, also known as consumer banking or personal banking, is the provision of services by a bank to the general public, rather than to companies, corporations or other banks, which are often described as wholesale banking (corporate banking).

Retail foreign exchange trading is a small segment of the larger foreign exchange market where individuals speculate on the exchange rate between different currencies. This segment has developed with the advent of dedicated electronic trading platforms and the internet, which allows individuals to access the global currency markets. As of 2016, it was reported that retail foreign exchang

Return on capital (ROC), or return on invested capital (ROIC), is a ratio used in finance, valuation and accounting, as a measure of the profitability and value-creating potential of companies relative to the amount of capital invested by shareholders and other debtholders. It indicates how effective a company is at turning capital into profits.

Return on capital employed is an accounting ratio used in finance, valuation, and accounting. It is a useful measure for comparing the relative profitability of companies after taking into account the amount of capital used.

The return on equity (ROE) is a measure of the profitability of a business in relation to its equity;

Returns-based style analysis (RBSA) is a statistical technique used in finance to deconstruct the returns of investment strategies using a variety of explanatory variables. The model results in a strategy's exposures to asset classes or other factors, interpreted as a measure of a fund or portfolio manager's investment style. While the model is most frequently used to show an equity mutu

Reuters 3000 Xtra was an electronic trading platform which was released by Reuters in 1999 and supported until the end of 2013. It was typically used by professional traders and financial analysts in trading rooms. It was superseded by the Eikon platform, first released in 2010.

A reverse convertible security is a type of convertible security where a bond or short-term note can be converted to cash, debt or equity at a set date by the issuer based on an underlying stock. In effect it is a type of option on the maturity date where the bond can be converted to shares or cash. For the investor they get the advantage of a steady stream of income due to the payment o

In finance, a reverse stock split or reverse split is a process by which shares of corporate stock are effectively merged to form a smaller number of proportionally more valuable shares.

Risk arbitrage, also known as merger arbitrage, is an investment strategy that speculates on the successful completion of mergers and acquisitions. An investor that employs this strategy is known as an arbitrageur. Risk arbitrage is a type of event-driven investing in that it attempts to exploit pricing inefficiencies caused by a corporate event.

Risk of ruin is a concept in gambling, insurance, and finance relating to the likelihood of losing all one's investment capital or extinguishing one's bankroll below the minimum for further play. For instance, if someone bets all their money on a simple coin toss, the risk of ruin is 50%. In a multiple-bet scenario, risk of ruin accumulates with the number of bets: each play increases th

Risk parity (or risk premia parity) is an approach to investment management which focuses on allocation of risk, usually defined as volatility, rather than allocation of capital. The risk parity approach asserts that when asset allocations are adjusted (leveraged or deleveraged) to the same risk level, the risk parity portfolio can achieve a higher Sharpe ratio and can be more resistant

A risk premium is a measure of excess return that is required by an individual to compensate being subjected to an increased level of risk. It is used widely in finance and economics, the general definition being the expected risky return less the risk-free return, as demonstrated by the formula below.

In finance, risk reversal (also known as a conversion when an investment strategy) can refer to a measure of the volatility skew or to a trading strategy.

Risk-adjusted return on capital (RAROC) is a risk-based profitability measurement framework for analysing risk-adjusted financial performance and providing a consistent view of profitability across businesses. The concept was developed by Bankers Trust and principal designer Dan Borge in the late 1970s. Note, however, that increasingly return on risk-adjusted capital (RORAC) is used as a

A risk-free bond is a theoretical bond that repays interest and principal with absolute certainty. The rate of return would be the risk-free interest rate. It is primary security, which pays off 1 unit no matter state of economy is realized at time

The risk-free rate of return, usually shortened to the risk-free rate, is the rate of return of a hypothetical investment with scheduled payments over a fixed period of time that is assumed to meet all payment obligations.

In mathematical finance, a risk-neutral measure (also called an equilibrium measure, or equivalent martingale measure) is a probability measure such that each share price is exactly equal to the discounted expectation of the share price under this measure.

In economics, finance, and psychology, risk-seeking (also called risk-loving or risk preference) refers to a behavioral tendency to prefer uncertain options with potentially higher rewards over safer alternatives with lower expected value. Risk-seeking individuals derive greater satisfaction or perceived utility from taking chances, even when the probable outcome may be less favorable. W

The Robin Hood tax is a package of financial transaction taxes (FTT) proposed by a campaigning group of civil society non-governmental organizations (NGOs). Campaigners have suggested the tax could be implemented globally, regionally, or unilaterally by individual nations. Conceptually similar to the Tobin tax (which was proposed for foreign currency exchange only), it would affect a wid

Robo-advisors or robo-advisers are financial advisers that provide personalized financial advice and investment management online with moderate to minimal human intervention. A robo-advisor provides digital financial advice that is personalised based on mathematical rules or algorithms. These algorithms are designed by human financial advisors, investment managers and data scientists, an

Rock, Rock, Rock! is a 1956 musical drama film conceived, co-written and co-produced by Milton Subotsky and directed by Will Price. The film is an early jukebox musical featuring performances by established rock and roll singers of the era, including Chuck Berry, LaVern Baker, Teddy Randazzo, the Moonglows, the Flamingos, and the Teenagers with Frankie Lymon as lead singer. Later West S

A rollup (also "roll-up" or "roll up") is a process used by investors (commonly private equity firms) where multiple small companies in the same market are acquired and merged.

A rotating savings and credit association (ROSCA) is a group of individuals who agree to meet for a defined period in order to save and borrow together, a form of combined peer-to-peer banking and peer-to-peer lending. Members all chip in regularly and take turns withdrawing accumulated sums.

Royal Mint Gold was a digital gold currency and a cryptocurrency backed by gold reserves in the UK Royal Mint. The Royal Mint launched a digitized token called RMG, representing one gram of physical gold per token, in 2016. It began testing blockchain transactions in April 2017. The first test transaction was in August 2017. The rollout was originally scheduled to occur by the end of 20

A royalty fund (also known as royalty funding) is a category of private equity fund that specializes in purchasing consistent revenue streams deriving from the payment of royalties. Royalties are a usage-based payment from one individual or entity to another individual or entity, giving the right to use an asset, product, service or idea.

RuPay (portmanteau of Rupee and Payment) is an Indian multinational financial services and payment service system, conceived and owned by the National Payments Corporation of India (NPCI). It was launched in 2012, to fulfil the Reserve Bank of India's (RBI) vision of establishing a domestic, open and multilateral system of payments. RuPay facilitates electronic payments at almost all Ind

The National Payment Card System (Russian: Национальная система платёжных карт; known its acronym NSPK) is an operational and payment clearing house for processing bank card transactions within Russia and the operator of the Mir card payment system. It is the operational and payment clearing house of the Faster Payment System (FPS) and wholly owned by the Central Bank of Russia (CBR).

S&P 500 futures are financial futures which allow an investor to hedge with or speculate on the future value of various components of the S&P 500 Index market index. S&P 500 futures contracts were first introduced by the Chicago Mercantile Exchange in 1982. The CME added the e-mini option in 1997. The bundle of stocks in the S&P 500 is, per the name, composed of stocks of 500 large compa

In mathematical finance, the SABR model is a stochastic volatility model, which attempts to capture the volatility smile in derivatives markets. The name stands for "stochastic alpha, beta, rho", referring to the parameters of the model. The SABR model is widely used by practitioners in the financial industry, especially in the interest rate derivative markets. It was developed by Patric

A safe deposit box, sometimes referred to as a safety deposit box, is an individually secured container, usually held within a larger safe or bank vault. Safe deposit boxes are generally located in banks, post offices, or other institutions.

Sales and trading is one of the primary front-office divisions of major investment banks. The term is typically reserved for the trading activities done by sell-side investment banks who are primarily engaged in making markets for institutional clients in various forms of securities. The trading floor of these banks will contain dedicated desks who generally focus exclusively on trading

The dobra (Portuguese pronunciation: [ˈdɔβɾɐ]) is the currency of São Tomé and Príncipe. It is abbreviated Db and is divided into 100 cêntimos. The first dobra (STD) was introduced in 1977, replacing the escudo at par. Due to past inflation, on 1 January 2018 the dobra was redenominated at a rate of 1000 to 1, and given the new ISO 4217 currency code STN.

Sarkaru Vaari Paata (transl. Government song) is a 2022 Indian Telugu-language action comedy drama film written and directed by Parasuram. It is produced by Mythri Movie Makers, 14 Reels Plus and G. Mahesh Babu Entertainment and stars Mahesh Babu, Keerthy Suresh and Samuthirakani in lead roles. The film follows a conflict between Mahi, a financier and MP named Rajendranath, after his dau

Sarvatra Technologies Private Limited is an Indian fintech company, headquartered in Pune, Maharashtra, that provides banking software and cloud-based services to cooperative banks and smaller financial institutions. As of 2024, the company had a 55% market share in providing banking software to banks in India, with its PaaS model operating in 600 banks across India.

A savings account is a bank account at a retail bank. Common features include a limited number of withdrawals, a lack of checks and linked debit card facilities, limited transfer options and the inability to be overdrawn. Traditionally, transactions on savings accounts were widely recorded in a passbook, and were sometimes called passbook savings accounts, and bank statements were not pr

A savings and loan association (S&L), or thrift institution, is a financial institution that specializes in accepting savings deposits and making mortgage and other loans. While the terms "S&L" and "thrift" are mainly used in the United States, similar institutions in the United Kingdom, Ireland and some Commonwealth countries include building societies and trustee savings banks. They ar

Saxo Bank is a Danish investment bank specialising in online trading and investment. It provides access to financial instruments, including Forex, stocks, CFDs, futures, funds, bonds and futures spreads through its SaxoInvestor and SaxoTrader platforms.

A scrip is any substitute for legal tender.

Scripophily is the study and collection of stock and bond certificates. A specialized field of numismatics, scripophily has developed as an area of collecting because of the inherent beauty of certain historical certificates, and because of interest in the historical context of many of the documents. In addition, some stock certificates serve as excellent examples of engraving. Occasiona

A seasoned equity offering (SEO) or capital increase is a new equity issued by an already publicly traded company. Seasoned offerings may involve shares sold by existing shareholders (non-dilutive), new shares (dilutive), or both. If the seasoned equity offering is made by an issuer that meets certain regulatory criteria, it may be a shelf offering.

SEC Rule 10b-5, codified at 17 CFR 240.10b-5, is one of the most important rules targeting securities fraud in the United States. It was promulgated by the U.S. Securities and Exchange Commission (SEC), pursuant to its authority granted under § 10(b) of the Securities Exchange Act of 1934. The rule prohibits any act or omission resulting in fraud or deceit in connection with the purchase

SEC Rule 10b5-1, codified at 17 CFR 240.10b5-1, is a regulation enacted by the United States Securities and Exchange Commission (SEC) in 2000. The SEC states that Rule 10b5-1 was enacted in order to resolve an unsettled issue over the definition of insider trading, which is prohibited by SEC Rule 10b-5.

The secondary market, also called the aftermarket, is the financial market in which previously issued financial instruments such as shares, bonds, options, and futures are bought and sold. The initial sale of the security by the issuer to a purchaser, who pays proceeds to the issuer, is the primary market. All sales after the initial sale of the security are sales in the secondary market