Management Company – An investment company that is organized as a corporation and employs an investment advisor to manage portfolio securities against which it issues shares to the public. There are two (2) types – open-end and closed-end.

Market Maker – A FINRA member that gives bid and ask prices at which it stands ready to buy or sell securities from its inventory at its own risk in the over-the-counter market.

Market Risk – The risk that a security has based on the overall market. Also known as systematic risk or un-diversifiable risk. For equity securities it is the risk that the stocks will drop due to a sell-off in the market. For bonds, it is the risk that interest rates will cause market bond prices to go down.

Marketability Risk – Also known as liquidity risk. The risk that a security will be difficult to liquidate/sell.

Maturity Date – The date on which the borrower must repay the principal on an outstanding debt security.

Micro Cap – A company whose market capitalization is less than three (3) hundred million.

Mid Cap – A company whose outstanding market capitalization is between two (2) billion and ten (10) billion.

Money Purchase Pension Plan – A defined contribution retirement plan that specifies a fixed percentage of income or fixed dollars to be contributed to the plan annually regardless of profitability.

Money Supply – The total amount of money that is available in the economy.

Monte Carlo Simulation – A computer simulation used to approximate the impact of changes in multiple variables simultaneously on the expected performance of an investment over a specified time frame.

Mortgage – A loan made on real property where the lender has a lien on the property until the mortgage is paid off. This is not a security.

Mortgage-Backed Pass – Through Certificate – A certificate that represents an undivided interest in a pool of mortgage payments. The monthly mortgage payments made into the pool are passed-through to the certificate holders. This is a security.

Mortgage-Backed Securities – A type of security that is backed by a mortgage or collection of mortgages.

Mortgage Bond – A secured corporate bond backed by specific real estate the company owns. Mortgage bonds are backed by real estate or physical equipment that can be liquidated.

Municipal Securities Rulemaking Board (MSRB) – The primary rulemaking authority for the municipal market participants which include bank dealers and broker/dealers.
Municipal Bond – A debt security issued by a municipality, state, political subdivision, authority, or territory of the United States (US) to raise capital for projects or their day-to-day activities.

Mutual Fund – The common name for an open-end management company that establishes a diversified portfolio of investments that is actively managed, continuously issues new share, and redeems (buys back) old shares representing ownership in the portfolio.