A distance that is not large enough when the annoying store clerk has rancid breath. In truth, arm’s length market means you don’t know the person you’re doing business with (on a personal level).
This term can apply to many areas of business. For example, if you’re purchasing stock in McDonald’s, you probably don’t know any of the executives of the company who would likely have inside information regarding how well or poorly this quarter was going. You don’t have insider info, and you’re not involved in a relationship with anyone who is involved in McDonald’s.
This can also apply to real estate (like when you buy a home). If you don’t know the person you’re buying from or selling to, this is considered an arm’s length transaction in which you’ll pay (or receive) a fair price. If you’re not operating within arm’s length, and you’re not paying fair market value, you might have to pay some fancy taxes.
Related or Semi-related Video
Finance: What is a regular way contract?1 Views
Finance a la shmoop what is a regular way contract?
alright well for centuries the church has condemned anything but the regular [Men appear in church]
way but then some wise guy posited a question about anything but so then some
wise Torah scribe added an extra letter T there and well everything was a mess [Person wiping letter T out]
and well "regular way" just stopped really being a thing anyway in
finance land regular way simply describes a securities trade when trades
settle regular way, it means that they follow the normal T plus 3, T plus 5, T
plus whatever days that's accorded whatever trade it is they're making a
corporate debt trade well that's usually T plus 3 or 3 days regular way would
imply that the corporate debt will settle in the regular three-day time [Amount owed appears on corporate debt timeline]
period the foreign exchange trade for a stock well that's usually 2 days T plus
2 would be the regular way the basic idea is that there are so many trades
and trade types now that happen in a non regular way because of some weird
restriction or government filing requirement or computer hacking that
happened out there or other global event that precluded things going the au
natural or regular way that noting when something trades regular way [People shouting at trading company]
actually has become a thing like we actually have to call it out when things
happen normally and if you have any questions about what's kosher or not in
regular ways well we suggest you consult your religious scribe or book in
whatever form it comes in it's not our business [Man asking priest questions]
Up Next
What are Prudent Investor Rule Standards, the Know Your Client Rule, and unsuitable recommendations?
What is insider trading and the Securities Fraud Enforcement Act of 1988? It's nothing too complicated, if this minute long video is any indication.
The Greater Fool Theory posits that there is always a greater fool out there to buy an item at a higher price... until there isn't.
What is mark to market? Is it when Mark Zuckerberg writes the stock market a letter, thanking it for being a friend?