Accredited investor. Individual accredited investors must satisfy one of the following standards: (a) have a combined net worth with their spouse in excess of $1,000,000; (b) have individual income for the past two years and a reasonable expectation of income for the current year in excess of $200,000, (c) have joint income with their spouse in excess of $300,000 for the past two years and a reasonable expectation of such income for the current year; or (d) be a director or executive officer of the company. Accredited investors also include banks, savings and loan associations, brokers, dealers, insurance companies, and other institutions. Under some circumstances, accredited investors may engage in securities purchases exempted from registration requirements.

Analyst. An employee of a broker-dealer who analyzes, without commercial bias, the performance, prospects, and value of stocks and who provides this information to his or her employer and its clients. Analysts usually specialize in a particular industry or stock type.

Annual meeting. Corporate law and stock exchange rules require public corporations to hold annual shareholder meetings to elect directors and conduct other shareholder business. Often, annual meetings are mainly ceremonial because most shareholders' votes are cast by mail through proxy cards, and the outcome is a foregone conclusion. However, some annual meetings can devolve to proxy fights and verbal attacks against management when an issue is hotly contested.

Annual report. The annual report is issued yearly by public corporations to its shareholders, and contains the detailed financial and business information required by law. The front part of an annual report often contains marketing material such as impressive graphics and narrative highlights about the company's successes over the past year. This term also can refer to the document filed with the SEC containing all the information required of an annual report by the proxy rules, and more.

Blue Sky Laws. Blue sky laws are the individual states' securities laws. The term "blue sky laws" was coined around 1900 by a Kansas Supreme Court Justice who wanted to protect investors from speculative ventures without more basis than "so many feet of blue sky."

Board of directors. A board of directors is the body responsible for overseeing a company's affairs. Shareholders elect the directors to the board. In turn, directors appoint and oversee officers. Boards normally have working committees such as an executive committee which may act for the entire board under certain circumstances, or a compensation committee which determines officer compensation and benefits and oversees corporate compensation policies.

Broker. One who buys and sells securities for others, in exchange for a commission.

Broker-dealer. One who functions as both a broker and a dealer. Most stock brokerages are broker-dealers. See "Broker" and "Dealer."

Bylaws. The document that contains the ground rules by which a company is run. Bylaws normally establish such matters as the titles and duties of executive officers, the timing and procedures for board meetings, and the manner for conducting the annual shareholder meeting.

CAO. Chief Accounting Officer, or corporate comptroller. The CAO usually reports to the CEO or CFO.

CEO. Chief Executive Officer, often also the chairman of the board, and sometimes the president. The CEO oversees the company's finances and strategic planning.

CFO. Chief Financial Officer. The CFO is responsible for the corporation's accounting and financial structure and activities. The CFO usually reports to the CEO.

CIO. Chief Information Officer, often called the vice president of management information systems or of data processing.

Charter. The document that creates a corporation, often called the articles of incorporation. The charter is filed with the secretary of state in the state of incorporation. It establishes the basic framework for the corporation, including its purpose, the amount of stock it may issue, and the number of its directors. Only shareholders may alter a corporate charter.

Cheap stock. Stock sold just prior to an IPO at prices "substantially" below the IPO price. A "substantially" lower price is normally deemed to be 85 percent or less of the IPO offering price.

CLO. Chief Legal Officer, usually known as the company's general counsel. The CLO usually reports to the CEO.

Dealer. Dealers are entities or individuals in the regular business of buying and selling securities for their own account.

Director. A person elected to a corporation's board of directors. A director may be an inside director (a director who is also an officer) or an outside, or independent, director. See "Board of Directors."

Disclosure laws. Disclosure laws require companies to fully and fairly disclose all material facts relating to a securities offering.