Alan Greenspan: Brief Bio, Policies, and Legacy American economist Alan Greenspan presided over the Federal Reserve’s Board of Governors from 1987 to 2006, serving as the country’s central bank. He also held the position of chair of the Federal Open Market group (FOMC), the Fed’s main group for formulating monetary policy and controlling the nation’s...  Read more

What Is a Payment in Advance? A payment known as an advance payment is made before the due date, for example, by paying for a good or service before you receive it. Sometimes, merchants want upfront payments as insurance against nonpayment or to cover the seller’s out-of-pocket expenses for providing the good or service. Advance...  Read more

What Is Aggregate Stop-Loss Insurance? The aggregate stop-loss insurance policy limits claim coverage to a certain amount. This coverage protects self-funded plans from catastrophic (particular stop-loss) or multiple (aggregate) claims. Aggregate stop-loss protects employers from unexpected claims. When claims exceed the aggregate limit, the stop-loss insurer pays or reimburses the employer. Aggregate Stop-Loss Insurance Self-funded...  Read more

Allotment Definition, Reasons for Raising Shares, and IPOs The systematic allocation or assignment of resources inside a company to different organizations throughout time is referred to as allotment. In the context of an initial public offering (IPO), allotment refers to the distribution of equity, particularly shares awarded to a participating underwriting company. When new shares...  Read more

What Is an Agent? Definition, Types of Agents, and Examples A legal agent is someone authorized to act on behalf of another. Agents can represent clients in negotiations and other third-party activities. The agent may make decisions. Attorneys defend their customers in legal problems, and stockbrokers help investors make investment decisions. The agent represents the...  Read more

Allocated Loss Adjustment Expenses (ALAE): What Are They? A single insurance claim’s processing fees are known as allocated loss adjustment expenses (ALAE). The expense reserves of insurance include ALAE. It ranks among the biggest expenses for which an insurer must set aside money along with potential commissions. Allocated Loss Adjustment Expenses (ALAE): An Overview The...  Read more

After-Hours Trading: How It Works, Advantages, Risks, Example After-hours trading is securities trading that starts at 4 p.m. U.S. Eastern Time after the major U.S. stock exchanges close. The after-hours trading session can run as late as 8 p.m., though volume typically thins out much earlier in the session. Trading after-hours is conducted through electronic...  Read more

What are agency costs? Included Fees and Examples Agency costs are internal company expenses resulting from an agent’s actions on behalf of a principal. Agency expenses often follow basic inefficiencies, dissatisfactions, and disturbances like shareholder-management conflicts. Agency costs go to the acting agent. Understanding Agency Cost When senior management and shareholders clash, agency expenses might...  Read more