limitations, especially those placed on the extent of interest rate or payment adjustments associated with adjustable-rate mortgage (ARM). An annual adjustment cap places a ceiling on the amount the interest rate can be changed during one year. A life-of-loan cap places a ceiling on the interest rate over the loan term. A payment cap limits the amount of change in the monthly payment amount from year to year.
THIS SENTENCE IS TYPED INALL CAPS. Contrast with mixed case; lowercase.
Internet tip: Don't send e-mail or post to newsgroups with your message typed in all caps. Not only is it more difficult to read, but it seems as if you are shouting (all your words are emphasized).
acronym for convertible adjustable preferred stock, whose adjustable interest rate is pegged to Treasury security rates and which can be exchanged, during the period after the announcement of each dividend rate for the next period, for common stock (or, usually, cash) with a market value equal to the par value of the CAPS. CAPS solved a problem inherent with dutch auction preferred stock, which was that the investor could not be certain of the principal value of the preferred.
