What Is a Recycle Ratio? A recycle ratio is a key profitability measure of the oil and gas industry. The ratio is calculated by dividing the profit per barrel of oil by the cost of finding and developing that barrel of oil. The profit per barrel is known in industry terminology as “netback,” and finding
What Is Red in Finance? In finance, the color red has several negative connotations that generally revolve around losing money. “Red” can denote a negative balance on a company’s financial statement or an individual’s bank account. It can also signify unfruitful investments, as well as unfavorable regulations governing businesses. Key Takeaways Red is a color
What Is Redacted? Redacted, a fairly common practice in legal documents, refers to the process of editing a document to conceal or remove confidential information before disclosure or publication. Key Takeaways Redacted, a fairly common practice in legal documents, refers to the process of editing a document to conceal or remove confidential information before disclosure
What Is a Red Candlestick? A red candlestick is a price chart indicating that the closing price of a security is below both the price at which it opened and previously closed. A candlestick may also be colored red if the close is below the prior close, but above the open—in which case it will usually
What Is a Red Clause Letter Of Credit? A red clause letter of credit is a specific type of letter of credit in which a buyer extends an unsecured loan to a seller. Red Clause Letters of Credit permit documentary credit beneficiaries to receive funds for any merchandise outlined in the letter of credit. These
What Is Redemption? Depending on the context, the term redemption has different uses in the finance and business world. In finance, redemption refers to the repayment of any fixed-income security at or before the asset’s maturity date. Bonds are the most common type of fixed-income security, but others include certificates of deposit (CDs), Treasury notes
What Is a Redemption Fee? A redemption fee is a fee charged to an investor when shares are sold from a fund. This fee, also known as an exit fee, market timing fee, or short-term trading fee, is charged by the fund company and then added back to the fund. Typically, it only applies when
What Is a Redemption Mechanism? A redemption mechanism is a method used by market makers of exchange-traded funds (ETF) to reconcile the differences between net asset values (NAV) and market values. This process, also referred to as the ETF creation and redemption mechanism, helps to prevents shares of an ETF trading at a discount or premium, keeping
What Is a Redemption Suspension? A redemption suspension is a temporary measure whereby investors in a fund are unable to withdraw, or “redeem,” the capital they invested in the fund. The term is mostly associated with hedge funds, which often reserve the right to impose redemption suspensions under certain rare circumstances. Typically, hedge fund managers
What Is a Red Herring? A red herring is a preliminary prospectus filed by a company with the Securities and Exchange Commission (SEC), usually in connection with the company’s initial public offering (IPO). A red herring prospectus contains most of the information pertaining to the company’s operations and prospects but does not include key details
