Financial Glossary
ترجمة
Describes the difference between a portfolio's performance vs. the average market performance over a set period of time
A country is said to have an absolute advantage if its output per unit of inputs of all goods is larger than that of another country
A record of financial transactions for an individual at a bank or a brokerage company
The dollar amount currently remaining in an account
An individual who usually works for a brokerage company and has the legal power to buy or sell financial instruments on behalf of a client
A summary of all transactions and positions (long and short) between a broker/dealer and a client
Money owed to customers or suppliers
Money owed by customers
Accredited investors must have a combined net worth with their spouse in excess of $1,000,000, or individual income for the past two years in excess of $200,000, or have joint income with their spouse in excess of $300,000 for the past two years or be a director or executive officer of the company
An interest rate that is adjusted periodically, usually according to a standard market rate outside the control of the bank or savings institution
Relationship between two companies when one company owns substantial interest of another company
Trading after regular trading hours on organized exchanges
An agent acts as intermediary between buyer and seller, taking no financial risk personally or as a firm, and charging a commission for the service
The total demand for goods and services produced in the economy over a period of time. It includes consumer demand of durable and nondurable items, investment spending by companies on capital goods, government spending on publicly provided goods and services, and the difference between exports and imports of goods and services of the country
A measure of the total supply of goods and services produced within the economy from domestic sources that are available to meet aggregate demand
A Futures order that instructs the broker to either fill the whole order or not at all
A coefficient measuring the risk-adjusted performance of a currency or stock option. A large alpha indicates that the underlying has performed better than would be predicted given its beta (volatility)
Investments in hedge funds that pursue strategies uncommon in mutual funds such as long-short equity, event driven, statistical arbitrage, fixed income arbitrage, convertible arbitrage, short bias, global macro, and equity market neutral
An option that may be exercised at any time prior to expiration, as opposed to a European option that can only be exercised on a specific date (usually at expiration)
American Stock Exchange
The formal securities market in Jordan
The repayment of a loan by installments
An employee of a brokerage house who studies companies and makes buy/sell recommendations on various instruments
Date when particular news concerning a company is announced to the public
Yearly record of a company's financial condition. It includes the firm's operations, balance sheet, income statement, and cash flow statement
The simultaneous purchase and sale of the same (or equivalent) financial instrument on different markets to profit from price discrepancies
The price at which the currency or instrument is offered
Any possession that has value
A security that is collateralized by loans, leases, receivables, or installment contracts on personal property, not real estate.
Account at a brokerage house, bank, or savings institution that integrates banking services and brokerage features
Instructions given to a dealer to buy or sell the currency or instrument at the best rate that can be obtained
Instructions given to a dealer to buy or sell the currency or instrument at a specific rate or better
A price equal to nominal or face value of a security
A price equal to nominal or face value of a security
An option whose strike/exercise price is equal to or near the current market price of the underlying instrument
An examination of a company's accounting records and books conducted by an outside professional in order to determine whether the company is maintaining records according to generally accepted accounting principles
On limit orders, a buy order away from the market would be placed lower than the current market price, and sell orders would be placed higher than the current market price. Such orders are usually held to be executed later
Business to Business; A strategy of dealing directly with businesses, rather than consumers
Clerical operations that support settlement of trades and related processes
Creating a hypothetical performance history by applying current selection criteria to prior time periods
A record of all economic transactions between the residents of a country and the rest of the world, usually over a specific period of time
The value of exports less imports of an economy. There are visible and invisible balance figures. The visible balance represents the physical goods while the invisible represents the service economy
Bank notes are paper issued by the central bank and are legal tender
The rate at which a central bank is prepared to lend money to its domestic banking system
A computer message system linking major banks that is used as a mechanism to advise the receiving bank of some action that occurred
Inability to pay debts
A path dependent option that has a knock-in or knock-out feature that causes the option to become effective or terminate if a specified barrier level is reached
In Foreign exchange markets, the base currency is the first currency in a currency pair. The second currency is named the quote currency or secondary
One hundredth of a percentage point (0.01%)
The difference between the cash price and futures price
A spread designed to exploit falling exchange rates by purchasing a put option with a high strike price and selling one with a low strike price
A substantial drop in prices over a prolonged period of time
An investor who believes that prices are going to fall
Person who enjoys the benefits of ownership even though title is in another name
The measure of an asset's risk in relation to the market. A security with a beta of 1.5, will move about 1.5 times the market return
The highest price a dealer will pay at any given time to purchase a currency pair or a financial instrument
Refers normally to the first three digits of an exchange rate
An option pricing formula initially derived by Fisher Black and Myron Scholes for securities options and later refined by Black for options on futures
A technical study used by chartists; Plus or minus two standard deviations where the standard deviations are calculated historically in a moving window estimation. Hence, the bands will widen if the most recent data is more volatile. If the prices break out of the band, this is considered a significant move
Bonds are debt instruments issued by a government or municipality for a period of more than one year. An investor is lending money when buying bonds. The seller of the bond agrees to repay the principal amount of the loan at a specified time plus interest
A rating based on the possibility of default by a bond issuer. The ratings range from AAA to D
The price of a financial instrument where total revenue received equals total costs (TR=TC)
A technical term used by chartists to denote a break of a support, a resistance level, or any technical formation
An agent who executes orders to buy and sell currencies and related instruments either for a commission or a spread
The commission charged by a broker
Bundesbank, the Central Bank of Germany
A spread designed to exploit rising exchange rates by purchasing a put option with a lower strike price and selling one with a higher strike price
An option strategy combining a bull and bear spread. It uses three strike prices. The lower two strike prices are used in the bull spread and the higher strike price from the bear spread. Both puts and calls can be used
A term for gold bars
An option strategy combining a bull and bear spread. It uses three strike prices. The lower two strike prices are used in the bull spread and the higher strike price from the bear spread. Both puts and calls can be used
The purchaser of a currency pair or an option
Rate at which the dealer is willing to buy the currency; or bid price
In an option, buy the nearby contract and simultaneously sell the deferred contract; also referred to as a bull spread
A term used in the foreign exchange market for the USD/GBP rate
An option position comprised of purchase and sale of two option contracts of the same type and at the same strike price but with different expiration dates
An option that gives the holder the right, but not the obligation, to buy the underlying instrument at a specified price during a fixed period
To void a working order in the market
Money invested in a company
Capital Asset Pricing Model; An economic theory that describes the relationship between risk and expected return, and serves as a model for the pricing of risky securities
When securities are sold for a profit, the capital gain is the difference between the net sales price of the securities and their net cost
A general term encompassing all markets for financial instruments with more than one year to maturity
A term used to describe the amount of an underlying commodity; one commodity contract
A company that generates a steady and significant amount of free cash flow
Same day settlement
Measure of the actual cash generated by a business rather than the accounting profit
Also called spot markets; these are markets that involve the immediate delivery of an instrument
A method of settling certain futures or option contracts whereby the seller pays the buyer the cash value of the commodity traded
The highest price such as an interest rate or other numerical factor allowable in a financial transaction
A bank which is responsible for controlling a country's monetary policy
A negotiable certificate in bearer form issued by a commercial bank as evidence of a deposit with that bank which states the maturity value, maturity rate and interest rate payable
Provisions of the Bankruptcy Reform Act under which the debtor's assets are liquidated by a court because reorganization would fail to establish a profitable business
Provisions of the Bankruptcy Reform Act under which the debtor is reorganized by a court because the estimated value of the reorganization exceeds the expected proceeds from its liquidation
An individual who studies graphs of historic data to find trends and predict support and resistance levels as well as other continuation and reversal patterns
Options of the same type with the same underlying security
The procedure were a clearing house or principle becomes the buyer and/or the seller, and assumes responsibility for protecting buyers and sellers from financial loss by assuring performance on each contract
An adjunct to a futures exchange through which transactions executed on its floor are settled by a process of matching trades
A transaction which leaves the trade with a zero net exposure to the market with respect to a particular currency
Chicago Mercantile Exchange
Commodity Exchange of New York
The fee that a broker may charge clients for dealing on their behalf
A commodity is food, metal, or another fixed physical substance that investors buy or sell, usually through futures contracts
An option strategy consisting of both puts and calls at different strike prices to capitalize on a narrow range of volatility
Monthly measure of prices of a specified set of consumer goods and services, providing a measure of inflation. Rising CPI is normally associated with expectation of higher short term interest rates and may therefore be supportive for a currency in the short term.
The last trading date of a futures or options contract
The processes by which companies raise capital to fund growth, acquisitions etc; the division of an investment bank which advises on acquisitions, mergers, bid defenses, restructures and disposals
Any transaction taken to limit exposure
Having a long position in a currency or an asset combined with a short call option position on the same underlying currency or asset
An index that measures inflation such as CPI
The party that takes the other side of an exchange transaction
If a currency is traded against the dollar, the counter value would be the dollar value of the transaction
The risk of loss due to a counterparty defaulting or a debtor not repaying, or more generally the risk of loss due to some "credit event"
A foreign exchange deal involving two currencies that neither of which is the US Dollar or the base currency
Rates between two currencies that neither of which is the US Dollar or the base currency
An agreement to swap a series of specified payment obligations denominated in one currency for a series of specified payment obligations denominated in a different currency
The net balance of a country's balance of payments (BOP) and contains the import and export items of goods and services as well as transfer payments and net investment income
An order that is automatically canceled if not executed during the day
A trader who takes positions that are closed during the same trading day
The date that the transaction took place
The primary method of recording the basic information of a transaction
An individual or firm acting as a principal in the purchase or sale of currencies or securities. Dealers trade for their own account and risk
The latest day or time by which the buyer of an option must indicate to the seller his intention to execute the option
Failure to make timely payment of interest or principal on a debt security
A shortfall that is usually referenced to the balance of trade
A price index measuring changes in prices of all new, domestically produced, final goods and services in an economy
The date when the exchange of the currencies is made on a currency contract, or the value date. Could also refer to the exchange of commodity on a commodities contract
The calendar month in which a futures contract comes to maturity and becomes deliverable
Those locations designated by futures exchanges at which the futures contract may be delivered in fulfillment of the contract
The settlement of a futures contract by receipt or tender of a financial instrument, currency or commodity
Delta measures the sensitivity of the value of an option to changes in the price of its underlying instrument
A method used by option writers to hedge risk exposure of written options by purchase or sale of the underlying instrument in proportion to the delta
A ratio spread of options established as a neutral position by using the deltas of the options concerned to determine the hedge ratio
Deposit
The price at which an options holder can buy or sell the underlying instrument
A fall in the value of a currency due to market forces
The reduction of government's role in controlling markets, which leads to a free and presumably a more efficient marketplace
A broad term relating to instruments such as futures or options. The value of a derivative instrument moves in relation to the underlying
Deliberate downward adjustment of a currency against its fixed parities or bands, normally by formal announcement from the government
The purchase of a longer maturity option and the sale of a shorter maturity, lower exercise price option. The choice of calls or puts will determine its bear or bull character
For foreign exchange, the number of US dollars needed to buy one unit of a foreign currency
A system of floating exchange rates in which a government may intervene to change the direction of the value of the country's currency
The release of all information pertaining to the company's business activity, regardless of how that information may influence investors
A term used for instruments where the forward rate is lower than the spot rate or where an option is trading for less than its intrinsic value
The rate at which a central bank is prepared to discount certain bills for financial institutions as a means of easing their liquidity
Accounts over which an individual or organization, other than the person in whose name the account is carried, exercises trading authority or control
A decrease in the rate of inflation
A reduction in capital investment of a company and its decision not to replace depleted capital goods
Earnings after tax
When two or more averages or indexes fail to show confirming trends
A portion of a company's profit paid to common and preferred shareholders
The fixed or floating rate paid on preferred stock based on par value
A nation's internal market representing the mechanisms for issuing and trading securities of entities domiciled within that nation
A term used in technical analysis to refer to the drop of a stock's price, a rebound, and then a drop back to the same level as the original drop
A term used in technical analysis to refer to the rise of a stock's price, a drop, and then a rise back to the same level as the original rise
A negative change in ratings for a stock, or other rated security
Background check and research conducted by the company to assess validity of a prospective client and that client's customers
A measure of new orders placed with domestic manufacturers for immediate and future delivery. A major indicator of the health of the manufacturing sector in an economy
Earnings before Interest and Taxes
Earnings before Interest, Taxes and Depreciation
Earnings before Interest, Taxes, Depreciation and Amortization
Earnings Per Share; A company's profit divided by its number of outstanding shares
A day when the banks in a currency's principal financial center are open for business
A modest decline in interest rates or prices
A statistic released by a government body that indicates current economic trends such as growth rate, retail sales, employment, etc.
The percentage of the labor force that is employed
Exchange rate at which demand for a currency is equal to the supply of the currency in the economy
The residual dollar value of a trading account, assuming its liquidation is at the current market price
Currency deposited by companies and federal governments in banks outside their own country, usually currency of a non-European country deposited in Europe
Deposits denominated in United States Dollar at banks outside the United States
An option that can be exercised only on its expiration date rather than before that date
The group of countries formally known as the European Community
A system of controlling inflows and outflows of foreign exchange
The price of one country's currency expressed in another country's currency
The process of completing an order to buy or sell an instrument
The formal notification that the holder of a call (or put) option wishes to buy (or sell) the underlying security at the exercise price
The price at which an options holder can buy or sell the underlying instrument
The profit amount between the strike price and the underlying investment when the option is exercised
A less broadly traded currency or option
The last date after which the option can no longer be exercised
The month in which an option expires
The last date on which an option can be bought or sold
The condition of being subjected to a source of risk
Amount at which an asset would change hands between two parties, were both have knowledge of the relevant facts
A financial market that has a combination of high volatility and heavy trading
The interest rate at which banks lend to each other overnight. This is a closely watched short term interest rate that the Fed controls through open market operations
The United States Federal Reserve. The 7-member Board of Governors that oversees Federal Reserve Banks, establishes monetary policy, and monitors the economic health of the country
A 12-member committee which sets credit and interest rate policies for the Federal Reserve System. This committee consists of 7 members of the Board of Governors, and 5 of the 12 Federal Reserve Bank Presidents. This group, headed by the Chairman of the Federal Reserve Board, sets interest rates either directly (by changing the discount rate) or through the use of open market operations (by buying and selling government securities which affects the federal funds rate)
The 7-member Board of Governors that oversees Federal Reserve Banks. Its members are appointed by the President subject to Senate confirmation, and serve 14-year terms. Also called the Fed
The central banking system of the US comprising 12 Federal Reserve Banks controlling 12 districts under the Federal Reserve Board
One who must act for the benefit of another party
The price at which an order is executed
An exchange traded order that is canceled unless executed within a designated time period
A company whose business and primary function is to make loans to individuals, while not receiving deposits like a bank
An enterprise such as a bank whose primary business and function is to collect money from the public and invest it in financial assets
A futures contract based on a financial instrument
An organized institutional structure for creating and exchanging financial assets
Government spending and taxing for the specific purpose of stabilizing the economy
Official rate set by monetary authorities. Often the fixed exchange rate permits fluctuation within a band
A method for determining fixed rates. Such a process occurs either once or twice daily at defined times. The system is also used in the London Bullion market
Exchange rates with a fixed parity against one or more currencies with frequent revaluation. A form of managed float
An exchange rate where the value is determined by market forces
The profit/loss that may only be realized if the open contracts are liquidated (settled)
An exchanges trading area. May also be used as the lower limit of an option or an interest rate
See Federal Open Market Committee
The purchase or sale of a currency against another
An over-the-counter market where buyers and sellers conduct foreign exchange transactions
The seven leading industrial countries, being US, Germany, Japan, France, UK, Canada, Italy
G7 plus Belgium, Netherlands and Sweden, a group associated with IMF discussions
A measurement of how fast delta changes, given a unit change in the underlying price of the instrument
A significant price movement of a currency, security or commodity between two trading sessions
A Tendency toward a worldwide investment environment and the integration of national capital markets
A system for global after hours electronic trading in futures and options developed by Reuters for CME and CBOT for use in conjunction with various exchanges around the world
A Investment-grade gold which may be smelted into gold coins or bars
A monetary system that backs its currency with a reserve of gold, and allows currency holders to convert their currency into gold. The U.S. went off the gold standard in 1971
(GTC) An instruction to a broker that the order must remain valid until cancelled by the client
Before deduction of tax
GDP is the broadest measure of aggregate economic activity available. The total market value of all final goods and services produced in a country in a given year, equal to total consumer, investment and government spending, plus the value of exports, minus the value of imports
A ratio that is used to account for the effect of inflation on the GDP figure
See Good until Canceled
(GTF) An instruction to a broker that the order must remain valid until closing of trading day on Friday
A freely convertible currency that is not expected to depreciate in value in the foreseeable future
A technical analysis term referring to a chart formation in which a price exhibits three successive rallies, the second one being the highest. The name derives from the fact that on a chart the first and third rallies look like shoulders and the second looks like a head. Bearish indicator
An investment made in order to reduce the risk of adverse price movements in a currency or security, by taking an offsetting position in the same or a related instrument
A fund that may employ a variety of techniques to enhance returns
Hong Kong Inter-bank Offered Rate
The historical rate at which the price of an underlying currency or security moves up and down
Buyer
The simultaneous purchase and sale of two options that differ only in their expiration dates
A measure of the number of residential units on which construction is begun each month
Very high and self-sustaining inflation levels
An economic theory of British economist, John Maynard Keynes that active government intervention is necessary to ensure economic growth and stability
Slang for the New Zealand dollar
Where a barrier option becomes active as the underlying spot price hits the barrier level
Where a barrier option ceases to exist as the underlying spot price hits the barrier level
Economic indicators that follow rather than precede the country's overall pace of economic activity
Doctrine that a government should not interfere with business and economic affairs
The day on which trading ceases for an expiring contract
A transaction used to take a public corporation private that is financed through debt such as bank loans and bonds
The commercial or investment bank with the primary responsibility for organizing syndicated bank credit or bond issue. The lead manager recruits underwriting banks, negotiates terms of the issue with the issuer, and assesses market conditions
An economic indicator that changes before the economy has changed. Examples of leading indicators include production workweek, building permits, unemployment insurance claims, money supply, inventory changes, and stock prices
The degree to which an investor or business is utilizing borrowed money
The London Interbank Bid Rate; the rate charged by one bank to another for deposits
The London Interbank Offered Rate, the rate charged by one bank to another for lending money
London International Financial Futures Exchange
The maximum price decline permitted in one trading session
An order to buy or sell a specified amount of a security at a specified price or better
The maximum price advance permitted in one trading session
The amount that one bank is prepared to trade with another; or the amount that a dealer is permitted to trade in a given currency
A banking arrangement to lend an investor any amount up to the full amount of the line
Any transaction that closes out a previously established position
The ability of an asset to be quickly converted into cash; or a market with a large number of buyers and sellers
One of the key commercial interest rates in Europe; an interest rate for a loan against the security of pledged paper
The state of actually owning a currency, security, or commodity
The purchase of futures contracts for price protection purposes as a defensive position against an increase in cash prices
Cash in circulation; only used by the UK
Cash in circulation plus demand deposits at commercial banks
Includes demand deposits, time deposits and money market mutual funds, excluding large CDs
M2 plus large time deposits, repos of maturity greater than one day and institutional money market accounts
M2 plus negotiable CDs
Analysis of a country's economy as a whole
The minimum margin which an investor must keep on deposit in a margin account at all times for of each open contract
Difference between the buying and selling rates; or the initial deposit made brokerage firm upon establishing an account
The risk that a customer goes bankrupt after entering into a forward contract
An arrangement whereby the profits or losses on a futures contract are settled each day
The difference between the lowest current offered price and the higher price that a dealer charges to a customer
The conventional amount dealt between banks
An exchange order that automatically becomes a market order if the specified price is reached
An exchange order that is filled as close as possible to the close
A brokerage company or a bank that maintains a firm bid and ask price and is ready, willing, and able to buy or sell at publicly quoted prices
An order to buy or sell a financial instrument immediately at the best possible price
Marche a Terme International de France
The last trading day of a futures contract
A corporate debt instrument that has maturity bands of: 9 months to 1 year, more than 1 year to 18 months, more than 18 months to 2 years, etc., up to 30 years
The study of the behavior of small economic units such as individual consumers or households
The group of employees responsible for calculating profits and losses and for managing risks
The average of both buying and selling prices
Expression used to indicate that the willingness to buy at the rate offered by the counter party
The smallest increment of market price movement possible
Reserves required to be deposited at central banks by commercial banks and other financial institutions
Traders' reference for a Million
Money Markets
Principles underlying the analysis and evaluation of rational portfolio choices based on risk-return trade-offs and efficient diversification
Technical analysis term referring to indicators used to detect the speed or strength of a price movement
Market for short-term debt securities with maturity of one year or less and often 30 days or less
The total supply of money in circulation in a given country's economy at a given time
A technical analysis term meaning the average price of an instrument over a specified time period, used in order to spot pricing trends by flattening out large fluctuations
An open-ended fund operated by an investment company that raises money from shareholders and invests in a group of assets in accordance with a stated set of objectives
National Association of Securities Dealers; Nonprofit organization formed under the joint sponsorship of the investment bankers' conference and the SEC to provide regulation on the OTC market
The value of a fund's investments
The difference between total open long and open short positions in a given instrument held by an individual
The present value of the expected future cash flows minus the cost
Describing an opinion that is neither bearish nor bullish
The world's largest physical commodity futures exchange
NEW YORK STOCK EXCHANGE
A foreign currency current account maintained with another bank that is used to receive and pay currency assets and liabilities denominated in the currency of the country in which the bank is resident
A futures order, usually a Market order, in which the customer gives the floor broker total discretion to transact on a best-efforts basis
A short-term debt security usually with a maturity of five years or less
An international organization helping governments tackle the economic, social and governance challenges of a global economy
The price at which a seller is willing to sell
Temporary situation where offers exceed bids
A document that outlines the terms of securities to be offered in a private placement
The closing-out or liquidation of a position
The operations of a financial institution that although physically located in a country, has little connection with that country's financial systems
An account maintained by one broker with another in which all of the accounts of the former are combined and carried only in its name, rather than designated separately
The total number of outstanding option or futures contracts that have not been closed out by offset or fulfilled by delivery
Same as Federal Open Market Committee
Central Bank operations in the markets to influence exchange and interest rates
A position that is not yet closed
Options of the same type as said to be of the same class
The right, but not the obligation, to buy (call) or sell (put) a specific amount of a given stock, commodity, currency, index, or debt, at a specified price (the strike price) during a specified period of time
The net of the total commitments in a given currency
Over-the-Counter; A security which is not traded on an exchange
A call option whose strike price is higher than the market price of the underlying, or a put option whose strike price is lower than the market price of the underlying
Technically too high in price, and hence a technical correction is expected
Net long or short position in one or more currencies that a dealer can carry over into the next dealing day
A deal from today until the next business day
See OTC
Technically too low in price, and hence a technical correction to the upside is expected
Represents the excess of funds received for stock of a corporation in excess of its book value
Equal to the nominal or face value of a security; A bond selling at par is worth an amount equivalent to its original issue value or its value upon redemption at maturity
Equality; the value of one currency in terms of another
The date on which a dividend or bond interest payment is scheduled to be delivered
Payroll employment is a measure of the number of people being paid as employees by non-farm business establishments and units of government
Price Earnings Ratio; shows the multiple of earnings at which a stock sells and determined by dividing current stock price by current earnings per share
A fund set up to pay the pension benefits of workers after retirement
Foreign exchange reserves of oil producing nations arising from oil sales
A commodity is food, metal, or another fixed physical substance that investors buy or sell
The smallest price unit in a currency (0.0001 of a unit)
The 1985 Plaza Hotel agreement by the G5 to lower the dollar
Minimum fluctuation or smallest increment of price movement; One percent on an interest rate
A collection of investments, real and/or financial
The net of the total commitments in a given currency
A written authorization allowing a person to perform certain acts on behalf of another, such as moving of assets between accounts or trading for a person's benefit
Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders
The amount of cash today that is equivalent in value to a payment, or to a stream of payments, to be received in the future
Gaps occur when opening price movements create a blank spot on the chart. This occurs when the high of the day is below the low of the previous day or when the low of the day is above the high of the previous day
Usually refers to the select list of securities firms that are authorized to deal in new issues of government bonds
PPI; An inflationary indicator published by the U.S. Bureau of Labor Statistics to evaluate wholesale price levels in the economy
Trades based on signals from computer programs, usually entered directly from the trader's computer and executed automatically
The amount by which a forward rate exceeds a spot rate; the margin paid above the normal price level
See P/E above
The action taken by investors to sell when prices are rising or to purchase when prices are declining in order to secure gains
Gives the right but not the obligation to sell currencies or instruments at the option exercise price within a predetermined time period
Use of advanced econometric and mathematical valuation models to identify the firms with the best possible prospective
The price quoted for information purposes but not to deal
The amount of sales needed to reach a company's sales goal; an amount set by the government to limit imports or exports
A substantial rise in the market price following a decline
The high and low transaction prices of a currency, security or commodity during a given period
The price of one currency in terms of another
An evaluation of credit quality of a company's debt issue by a rating agency. Investors and analysts use ratings to assess the riskiness of an investment
Buying a specific quantity of options and selling a larger quantity of out of the money options
Selling more near-term options than longer maturity options at the same strike price
A reversal of the prevailing trend in price movement. The term is most often used to describe a decline after a period of rising prices
Inflation-adjusted model of Gross Domestic Product
An investor who has sold a currency or an instrument without having covered it
REAL TIME
A period of general economic decline; specifically a decline in GDP for two or more consecutive quarters
The rate at which interest earned on a loan can be reinvested. The rate may not attract the same level of interest as the principal amount
A contract in which the seller of fixed income securities such as Treasury Bills agrees to buy them back at a specified time and price
See Repo
Funds set aside for emergencies or other future needs; Official reserves are to ensure that a government can meet near term obligations
The ratio of reserves to deposits, expressed as a fraction, prescribed by national banking authorities
A price recognized by technical analysts as a price which is likely to result in a rebound but if broken through is likely to result in a significant price movement
RPI; an inflationary indicator that measures the change in the cost of a fixed basket of retail goods
A monthly measurement of all goods sold by retailers based on a sampling of retail stores of different types and sizes; often a measure of consumer confidence
Indicator of profitability. Determined by dividing net income for the past 12 months by common stockholder equity
A figure of merit used to help make capital investment decisions. ROI is calculated by considering the annual benefit divided by the investment amount
A system for screen-based trading between banks in operation since the early 1980s
Change in the general trend of the market
A change, usually an increase, in a country's fixed exchange rate as a result of official action
The process of analyzing exposure to risk and determining how to best handle such exposure
A combination of purchasing put options with the sale of call options. The put limits downside, while the call limits the upside
A completed transaction involving both a purchase and a subsequent sale, or a sale followed by a liquidating purchase
RUNNING A POSITION: Keeping open positions in the hope of a speculative gain
A transaction that matures on the day the transaction takes place
A strategy of buying at the bid and selling at the offer as soon as possible
Special Drawing Right; an artificial currency unit based upon several national currencies. SDR serves as the official monetary unit of the IMF, and acts as a supplemental reserve for national banking systems
The market in which securities are traded after they are initially offered in the primary market
Rate that a bank is willing to sell foreign currency
All options of the same class which share a common strike price and expiration date
The date by which an executed transaction must be settled; in currencies it is 2 days while stocks is 3 days
The official closing price for a future set by the clearing house at the end of each trading day
Certificates or book entries representing ownership in a corporation or similar entity
An investor who has sold a currency or an instrument without having covered it
Buying to unwind a short position
Normally the 90-day rate
The difference between estimated transactions costs and actual transactions costs. The difference usually represents revisions to price difference or spread and commission costs
Swiss Options and Financial Futures Exchange, a fully automated and integrated trading and clearing system
Refers to a transaction for immediate delivery; spot currency transactions have a value date of 2 business days
The overnight swap from the spot date to the next business day
The contract month closest to delivery
The price that a currency is currently trading in the spot market
A standard period of one-week swap measured from the current value date of the currency spot rate
The difference between the bid and ask price of a currency; the difference between the price of two related futures contracts
The buy and sell positions are in balance; no open positions
A speaker connected to a phone often used in broker trading desks
A term referring to certain normal amounts and maturities for dealing
Government obligations with maturities more than one year but less than ten years
A US firm engaged in assessing the financial health of borrowers. The firm also has generated certain stock indices i.e. S & P 500
Central Bank activity in the domestic money market to reduce the impact on money supply of its intervention activities in the FX market
British pound, otherwise known as Cable
A market order to buy or sell a certain quantity of a certain currency or security if a specified price (the stop price) is touched
British pound, otherwise known as Cable
The simultaneous purchase/sale of both call and put options for the same currency, exercise/strike price and expiry date
Recession or low growth in conjunction with high inflation rates
A combination of two calls and one put
When an exchange rate depreciates or appreciates to a level where technical analysis techniques suggest that the currency will rebound or not go below
A price as a differential between two dates of the swap
An exchange of streams of payments over time according to specified terms
An option to enter into a swap contract
Society for World-wide Interbank Telecommunications is a Belgian based company that provides the global electronic network for settlement of most foreign exchange transactions
Market slang for Swiss Franc
The artificial creation of an asset using combinations of other assets; In options, a long call option and a short put option amounts to a synthetic long, or a long put option and a short call option amounts to a synthetic short
Treasury Bill; Short-term obligations of a Government issued for periods of one year or less
The study of price action in markets through the use of charts and quantitative techniques to attempt to forecast price trends
An adjustment to the price of an instrument that is based on technical factors rather than market sentiment
The process of inviting parties to submit a formal offer for the supply or purchase of goods and services, followed by evaluation of offers and selecting a successful bidder
A Maturity of an option or a loan
Mathematically determined value of a derivative instrument as dictated by a pricing model such as the Black-Scholes model
A measure of the sensitivity of the price of an option to a change in its time to expiry
A market in which trading volume is low and in which consequently bid and ask quotes are wide due to lack of liquidity of the instrument
The primary method of recording the basic information of a transaction
The portion of the option premium that is attributable to the amount of time remaining until the expiration of the option contract. Time value is whatever value the option has in addition to its intrinsic value. The longer the time remaining until expiration, the higher the time value
A method of security selection that starts with asset allocation and works systematically through sector and industry allocation to individual security selection
Simultaneous buying of a currency for delivery the following day and selling for the spot day or vice versa
An oral or electronic transaction involving one party buying or selling a currency, security, or derivative from another party
The sum of the money gained by a given economy by selling exports, minus the cost of buying imports; part of the balance of payments
The date on which a trade occurs
The difference between the value of imports and exports
The smallest transaction size acceptable
The primary method of recording the basic information of a transaction
The date on which a trade occurs
An executed order to buy or sell an instrument; could be an entry or a liquidation trade
The corporate officer responsible for designing and implementing a firm's financing and investing activities
Short-term obligations of a Government issued for periods of one year or less. Treasury bills do not carry a rate of interest and are issued at a discount on the par value. Treasury bills are repaid at par on the due date
Government obligations with maturities of ten years or more
Government obligations with maturities more than one year but less than ten years
Outstanding stock that has been sold and subsequently repurchased by the issuing firm. Treasury stock does not carry voting rights or an ability to collect dividends, and is not used in earnings per share calculations
The total money value of currency contracts traded is calculated by multiplying size by the number of contracts traded
When a dealer quotes both buying and selling rates for foreign exchange transactions
A position not covered by an offsetting position
A short call option position in which the writer does not own the underlying product represented by the option contracts
An exchange rate is normally considered to be undervalued when it is below its purchasing power parity
A firm, usually an investment bank, that buys an issue of securities from a company and resells it to investors
Acting as the underwriter in the issue of new securities for a firm
The percentage of the people classified as unemployed as compared to the total labor force
Items in the current account of the balance of payments of a country that correspond to gifts from foreigners or pension payments to foreign residents who once worked in the particular country
A transaction executed at a price greater than the previous transaction
Determination of the value of a company's stock based on earnings and the market value of assets
For exchange contracts it is the day on which the two contracting parties exchange the currencies which are being bought or sold. For a spot transaction it is two business banking days forward in the country of the bank providing quotations which determine the spot value date. The only exception to this general rule is the spot day in the quoting centre coinciding with a banking holiday in the country(ies) of the foreign currency(ies). The value date then moves forward a day
Spot normally settles after two working days
Transaction executed for same day settlement; sometimes also referred to as "cash transaction"
A simple option whose terms and conditions do not include any provisions other than exercise style, expiry and strike
Profits or losses on open positions in futures and options contracts which are paid or collected daily
Expresses the price change of an option for a one per cent change in the implied volatility
The sale of an option with a high exercise price and the purchase (in the case of a bull) or the sale (in the case of a bear) of an option with a lower exercise price. Both options will have the same expiration date
A measure of the fluctuations in the underlying instrument over a given time period. It is expressed as a percentage and computed as the annualized standard deviation of percentage change in daily price. High values usually mean high risk
Profits or The risk in the value of options portfolios due to the unpredictable changes in the volatility of the underlying asset
Generic term for the securities industry firms that buy, sell, and underwrite securities
A security entitling the holder to buy a proportionate amount of stock at some specified future date at a specified price, usually one higher than current market price. Warrants are traded as securities whose price reflects the value of the underlying stock
It measures changes in prices in the manufacturing and distribution sector of the economy and tends to lead the consumer price index by 60 to 90 days. The index is often quoted separately for food and industrial products
The difference between current assets and current liabilities
A day when the banks in a currency's principal financial center are open for business
A bank made up of members of the IMF whose aim is to assist in the development of member states by making loans where private capital is not available
Slang for milliard, one thousand million
YTD; The period beginning at the start of the calendar year up to the current date
A graph that shows changes in yield on instruments depending on time to maturity. A positive sloping curve has lower interest rates at the shorter maturities and higher at the longer maturities. A negative sloping curve has higher interest rates at the shorter maturities
A bond that pays no interest and is sold at a discount to its face value, with the full face value paid to the bondholder at maturity
A portfolio of zero net value established by buying and shorting component securities, usually in the context of an arbitrage strategy
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