Leverage Ratios
A series of ratios that measure the extent to which a firm has been financed by debt.

 

Leveraged Buy-Out
The "takeover" or acquisition of a company largely accomplished through the use of borrowed money.

 

Liabilities
Obligations that a company has outstanding and include such items as long-term debt, deferred income taxes, and accounts payable.

 

Limit (Limited Order or Limited Price Order)
An order given to a stockbroker regarding the conditions of a proposed security purchase or sale. A trade with a limit order will only occur if the particular security is trading at a specific price or better.

 

Liquidation
The process of dissolving a company whereby the firm's assets are sold and distributed to creditors and shareholders.

 

Liquidity Ratios
A series of ratios that measure the liquidity, or cash generating ability, or a firm.

 

Listed Stock
A stock that is listed for trading on an organized stock exchange.

 

Load
The sales charge levied on investors by some mutual funds.

 

Long Position
A financial term that denotes ownership of a security. For example, an investor who is long 100 shares of IBM is an investor who owns 100 shares of IBM.

 

Long-Term Debt as a Percentage of Capital Ratio
A ratio calculated by dividing a firm's long-term debt by the sum of the firm's shareholders' equity and long-term debt. The greater the percentage, the greater level of debt the firm has assumed relative to the investment shareholders have made in the company. A long-term debt as a percentage of a capital ratio of over 50% indicates more than a fair degree of leverage.