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<br />Face Value <br /> <br />The value of a security as given on the certificate or <br />instrument. <br /> <br />Federal Deposit Insurance <br />Corporation (FDIC) <br /> <br />A federal agency that insures bank deposits, currently up to <br />$100,000 per entity. <br /> <br />Federal Reserve System <br /> <br />The central bank of the United States created by Congress <br />and consisting of a seven member Board of Governors in <br />Washington, D.C., 12 regional banks and about 5,700 <br />commercial banks that are members of the system. <br /> <br />Liquidity <br /> <br />A liquid asset is one that can be converted easily and rapidly <br />into cash without a substantial loss of value. Having a good <br />amount of liquidity means being able to pay bills as they <br />become due. <br /> <br />Market Value <br /> <br />The price at which a security is trading at any given moment <br />and could presumably be purchased or sold. <br /> <br />Maturity <br /> <br />The date upon which the principal or stated value of an <br />investment becomes due and payable. <br /> <br />Money Market <br /> <br />The market in which short-term debt instruments (bills, <br />commercial paper, bankers' acceptances, etc.) are issued and <br />traded. <br /> <br />Money Market Fund <br /> <br />Mutual Fund that invests in commercial paper, banker's <br />acceptances, repurchase agreements, government securities, <br />certificates of deposit, and other highly liquid and safe <br />securities, and pays money market rates of interest. The City <br />currently has investments in a government money market <br />fund in which the portfolio consists of U.S. Treasury and <br />Agency securities. <br /> <br />Porifolio <br /> <br />Collection of securities held by an investor. <br /> <br />Safekeeping <br /> <br />A service to customers rendered by banks for a fee whereby <br />securities and valuables of all types and descriptions are held <br />in the bank's vaults for protection. The City currently uses <br />Bank of New York to safekeep our investment securities <br />purchased from outside brokers/dealers. Bank of New York <br />will pay the broker/dealer upon receipt of the authorized <br />security. <br /> <br />Securities & Exchange <br />Commission (SEC) <br /> <br />Agency created by Congress to protect investors in securities <br />transactions by administering securities legislation. <br /> <br />Investmenl G1ossary.doc <br /> <br />2 <br />