Warrant
A security entitling the holder to buy a proportionate amount of stock at some specified future date at a specified price, usually one higher than the current market price. Warrants are issued by corporations and often used as a sweetener bundled with bonds or preferred stock to enhance their marketability. They are like call options, but with much longer time spans that can stretch into years. In addition, warrants are offered by corporations whereas exchange traded options are not. See derivative.
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Whole life
The most widely purchased type of cash-value life insurance. Whole life combines term insurance with an investment component. The policy has two elements: the mortality charge, the part of your premium that pays for the insurance coverage, and a reserve, the investment component that earns interest. As you age, the portion that goes into the reserve decreases while the portion that pays for the mortality charge increases. Wealthy people sometimes use whole life policies as an estate-planning vehicle. They can set up an insurance trust, which applies the proceeds of the policy to their estate taxes when they die. That can save their heirs the considerable expense of settling the estate with Uncle Sam.
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Will
A legal document that specifies how assets are to be distributed at your death and names guardians for minor children. Drawing up a will is a very important aspect of estate planning.
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Wilshire 5000 Stock Index
A market-capitalization weighted index of approximately 7,000 U.S.-based equities traded on the New York Stock Exchange, American Stock Exchange and Nasdaq. The Wilshire 5000 is the best measure of the entire U.S. stock market. Contrast with S&P 500 and Dow Jones Industrial Average.
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Window dressing
Trading activity near the end of a quarter or fiscal year that is designed to dress up a portfolio to be presented to clients or shareholders. For example, a mutual fund manager may sell losing positions in his portfolio right before his semiannual report is released so he can display only positions that have gained in value.
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Working capital
The excess of current assets over current liabilities. This statistic shows a company's level of solvency. A company with a lot of working capital has cash to reinvest and make its business grow.
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World Bank
An organization created to make loans primarily to developing countries, with the stipulation that these governments must guarantee the loan. Its full name is the International Bank for Reconstruction and Development. Also called the IBRD.
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World Trade Organization
An institution created by the General Agreement on Tariffs and Trade that oversees international trade issues, resolves trade disputes and enforces the GATT trade pact. Abbreviated as WTO.
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Wrap account
An investment plan that wraps together money management and brokerage services. Wrap plans are popular for their simplicity. For one all-inclusive annual fee, an investment firm provides the services of a professional money manager, who creates a portfolio of stocks and bonds, or mutual funds, and takes care of all the trading.
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Writer
In the options market, the seller of put and call options.
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