What Is a Fairness Opinion? A fairness opinion is a report that evaluates the facts of a merger, acquisition, carve-out, spin-off, buyback, or another type of business purchase. It provides an opinion about whether or not the proposed stock price is fair to the selling or target company. Key Takeaways A fairness opinion is a report regarding
What Is a Fair Trade Price? A fair trade price is the minimum price paid for certain agricultural products imported from developing countries. Fair trade is a movement that believes it is unethical to pay producers in developing countries the market price if that price is too low to provide a sufficient quality of living.
What Is Fair Value? Fair value is the estimated price at which an asset is bought or sold when both the buyer and seller freely agree on a price. To determine the fair value of a product or financial investment, an individual or business may look at actual market transactions for similar assets, estimate the
What Is a FAKO Score? The term “FAKO Score” refers to any credit score that is not the “FICO Score” developed and sold by the publicly traded credit scoring company, Fair Isaac Corporation (FICO). Over the years, various websites have created and popularized credit scores that are intended to resemble the FICO score, but which
What is a Falling Knife? A falling knife is a colloquial term for a rapid drop in the price or value of a security. The term is commonly used in phrases like, “don’t try to catch a falling knife,” which can be translated to mean, “wait for the price to bottom out before buying it.” A falling knife can
What Is Fallout Risk? Fallout risk is the risk to a mortgage lender that an individual borrower backs out of a loan during the period between the formal offer of a loan and the closing of that loan. A mortgage is a loan that a lender or bank extends to a borrower for the purchase
What Is a False Signal? In technical analysis, a false signal refers to an indication of future price movements that gives an inaccurate picture of the economic reality. False signals may arise due to a number of factors, including timing lags, irregularities in data sources, smoothing methods, or the algorithm by which the indicator is calculated.
What Are Friends and Family Shares? The term “friends and family shares” refers to stock offered by a new business to friends, family members, or other associates of the company’s executives. These shares are usually one of the very first sources of capital for a young business entity. Entrepreneurs, issuers, and bankers may offer these
What Is a Family Income Rider? A family income rider is an addition to a life insurance policy that provides the beneficiary with an amount of money equal to the policyholder’s monthly income in the event the policyholder dies. The rider is a type of death benefit. It specifies the term for the additional coverage and
What Is an Extraordinary Item? Extraordinary items consisted of gains or losses from events that were unusual and infrequent in nature that were separately classified, presented and disclosed on companies’ financial statements. Extraordinary items were usually explained further in the notes to the financial statements. Companies showed an extraordinary item separately from their operating earnings
