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Thread: PCM Glossary

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    Cool PCM Glossary


    ABC Consumer Confidence --- ABN AMRO--- Absolute Return--- ACCI--- Account--- Accrual Bond--- Actuals--- Adjustable Peg --- Adjustment --- ADP --- Advance Retail Sales - United States --- ADX-Average Directional Index --- After-Hours Trading --- Agent Bank --- Aggregate Demand --- Aggregate risk --- Aggregate Supply --- Aggressor --- Agio --- AGM --- AIG --- All Industry Activity Index - Japan--- American Option --- Anonymous trading --- ANZ Commodity Price Index - New Zealand --- ANZ Job Advertisements - Australia --- AON=All Or None --- Appreciation --- Arbitrage --- Arbitrage channel --- Ascending Triangles --- Asian Option --- Ask --- Ask Price --- Ask Rate --- Ask Size --- Ask-Offer --- Asset --- Asset Allocation --- Asset Swap --- Assets --- Association Cambiste Internationale --- At Best --- At or Better --- At Par Forward Spread --- At the Price Stop-Loss Order --- At-the-Money --- Auction --- Auction- Rate Securities --- Aussie --- Authorized Dealer ---


    Back --- Back Office--- Back Testing --- Back to Back --- Backwardation --- bail out --- Balance --- Balance of Trade --- Balance-of-Payments --- Band --- Bank for International Settlements - BIS --- Bank holiday --- Bank Lending - Japan--- Bank Line --- Bank Notes --- Bank of England Meeting Minutes - United Kingdom --- Bank Rate --- Bar Chart --- Base Currency --- Base Price --- Base Rate --- Basing --- Basis --- Basis Convergence --- Basis Point --- Basis Price --- Basis Trading --- Basket --- BBA --- BCI-Business Cycle Indicator ---Bear --- Bear Call Spread --- Bear Market --- Beige Book - United States --- Bid --- Bid Price --- Bid-Offer Spread --- Bid/Ask Spread --- Big Figure --- Bilateral Clearing --- BIS - Bank for International Settlements --- Black-Scholes Model --- Blocked Currency--- Blotter --- blue chips --- BoC=Bank of Canada --- BoJ=Bank of Japan--- Bollinger Bands --- Bond --- Book --- Booked --- BOP --- BRC --- BRC Shop Price Index - UK --- Break Out --- Break-Even Point--- Bretton Woods--- Bretton Woods Accord of 1944--- British Retail Consortium-BRC--- Broad Liquidity--- Broken Dates--- Broker--- Brokerage--- BSA--- BSI--- BUBA--- Bull--- Bull Market--- Bulldogs--- Bundesbank--- Business Climate--- Business Conditions Survey--- Business Cycle Indicator-BCI--- Business Inventories--- Buy and Hold--- buy in--- Buy Limit Order--- Buy On Margin--- Buy stop--- Buy Stop Order--- Buyer's Market--- Buying Rate--- Buying Selling FX---


    Cable--- Cable Transfer --- Cable/Sterling--- Calendar Spread--- Call--- Call Option--- Call Rate---Cambist---Candlestick Chart--- Cap--- Cap-An abbreviation for capitalization--- Capacity utilization--- Capacity Utilization Rate - Canada--- Capex-Capital Expenditure--- Capital Investment-Germany--- Capital Account--- capital expenditure -CAPEX--- Capital Flow--- Capital Gain--- Capital Loss--- Capital Markets--- Capital Risk--- Capital Spending--- Capping--- Carry--- Carry Trade--- Carry-Over Charge--- Cash--- Cash and Carry--- Cash Market--- Cash Settlement--- CBI--- CBI Industrial Trends Survey - UK--- CBOE--- CBOT or CBT--- Central Bank--- CEO=Chief Executive Officer--- Certificate of Deposit--- CET--- CFD=Contract For Difference--- CFTC--- CGPI -Capital Goods Price Index--- CHAPS--- Chartist--- CHIPS--- CIBOR--- Civic Federation--- Claimant Count Rate--- Clean float--- Clearing--- clearing house--- Closing a Position--- Closing Market Rate--- Closing Price--- Closing Purchase Transaction--- CME--- CML--- Coincidence Indicator Index--- Coincident Index - Japan--- Coincident Indicator--- Collateral--- Comex--- Commercial Paper--- Commission--- Commodity--- Commodity Futures Trading Comission--- Company Operating Profit-Australia--- Composite Index of Leading Indicators--- Compound Option--- Concerted Intervention--- conference board--- Confirmation--- Construction output--- Consumer Confidence Index--- Consumer Credit--- Consumer Price Index--- Consumer sentiment--- consumer spending--- Contagion--- Contract--- Contract Expiration Date--- Contract Month--- convenience store--- Convenience Store Sales--- Convergence--- Conversion--- Convertible currency--- Copey--- Corporation--- Correction--- Correlation--- correspondent--- Correspondent Bank--- Cost of Carry--- Cost of Living Index--- Counter Currency--- Counterpart--- Counterparty--- Counterparty Risks--- Countervalue--- Country Risk--- Coupon Value--- Cover--- CPI--- Crawling peg--- Credit Card--- Credit Checking--- credit line--- Credit Risk--- Cross Currency Pairs--- Cross Deal--- Cross Rate--- Cross rates --- Cross-Rate --- Cross-Trade--- Crossover--- Cup with Handle --- Currency --- Currency Basket --- Currency Option--- Currency Pair--- Currency Risk --- Currency symbols --- Current Account--- Current Balance --- Cycle---


    Daily Trading Limit--- Day Order--- Day Trader--- Day Trading--- DCLG--- Deal Date--- Deal Ticket--- Deal Ticket/Deal Slip--- Dealer--- Debt--- Declaration Date--- Default--- Deficit--- Deflator--- Delivery--- Delivery Date--- Delivery Month--- Delivery Points--- Delivery Risk--- Delta--- Department for Communities and Local Government--- Depo--- Depository Institution--- Depreciation--- Derivative---Derivatives--- Desk--- Details--- Devaluation--- DEWR--- DEWR Skilled Vacancies - Australia--- DIBOR--- Direct Quote--- Dirty Float--- Discount--- Discount House--- Discount Rate--- Discretionary Account--- Distributive Trade--- Dividend--- Domestic CGPI -Domestic Corporate Goods Price Index- Japan--- Domestic corporate Goods Price Index_Domestic CGPI - Japan--- Domestic Demand--- Double--- Durable Goods Order--- Dwelling Starts - Australia---


    Easing--- ECB-- Echo Watchers Survey--- Economic Exposure--- Economic and Monetary Union - EMU--- Economic Exposure--- Economic Indicator--- Economy - Overheated--- ECP-Eurocommercial Paper--- ECU--- ECU - European Currency Unit--- EDI--- Efficient Market Theory--- Efficient Markets--- EFT--- EIA Natual Gas Report--- EIA-Energy Information Administration--- Elliot Wave Theory--- Empire State Manufacturing Survey - United States--- employment cost index--- Employment Level - Switzerland--- EMS--- EMU--- EMU (Economic and Monetary Union)--- End Of Day Order - EOD--- Entrepot--- Envelopes--- EOD - End Of Day Order--- EOE--- Equilibrium--- Equipment Investment - Germany - Euro-zone--- equity market--- ERM--- Euro--- Eurobond--- Euroclear--- Eurodollar--- European Monetary Union--- European Monetary Union - EMU--- European Union--- Exchange Rate Risk--- Exchange control--- Exchange Rate Risk--- Execution--- exercise--- Exercise (options)--- Exercise Notice--- Exercise Price - Strike Price--- Exotic--- Expansion--- Expiration Date--- Expiration Month--- Expiry Date--- Exponentially Weighted Moving Average - EMA--- Exposure---


    face value--- Factory Orders--- Fast Market--- FDIC=Federal Deposit Insurance Corporation--- Fed - Federal Reserve--- Fed Fund Rate--- Fed Funds--- FEDAI--- Federal Deposit Insurance Corporation - FDIC--- Federal National Mortgage Association-Fannie Mae--- Federal Open Market Committee--- Federal Open Market Committee =FOMC--- Federal Reserve - Fed--- Federal Reserve Board--- Federal Reserve System--- Fedwire--- Fill--- Fill or Kill--- Fill Price--- Final Goods---Finance--- Financial Asset--- Financial Risk--- Finantial Institution--- Finex--- Fiscal Policy--- Fisher Effect--- Fixed Interest Security--- Fixed Exchange Rate--- Flat/square--- Floating Exchange Rate--- Floor--- FOMC--- FOMC Meeting Announcement--- foreclose--- foreclosure--- Foreign Currency Effect---JUMPTO=Foreign direct investment - FDI---Foreign Exchange--- Foreign Exchange Centers--- Foreign Exchange Market--- Foreign Position--- Forward--- Forward Contract--- Forward Cover Taking--- Forward Deal--- Forward margins--- Forward Operations--- Forward Outright--- Forward Points--- Forward Price--- Forward Rate--- Forward Rates--- Free Reserves--- Front Office--- Fundamental Analysis--- Fundamentals--- Futures--- Futures Exchange-Traded Contracts--- FX--- FY---


    G10--- G5--- G7--- Gamma--- Gap--- GCC=Gulf Cooperation Council--- GDP=Gross Domestic Product--- German ZEW Indicator of Economic Sentiment--- Gilt-edged Securities--- Gilts--- Globex--- GNP Deflator--- GNP Gap--- Going Long--- Going Short--- Gold Standard--- Gold Tranche--- Golden Cross--- Good Till Cancelled Order - GTC--- Government Expenditures - Euro-zone--- Government Spending--- grantor--- Greenery Day--- Gross Domestic Product--- Gross Fixed Capital Formation (GFCF) - Euro-zone--- Gross National Product--- GTC - Good 'Til Cancelled Order---


    Hard Currency--- HBOS--- Hedge--- Hedge Fund--- Hedge Ratio--- Hedged position--- Hedging--- Help Wanted Index--- HIA---HICP--- high or low- Spike--- High/Low--- Hit the bid--- Household Consumption - Euro-zone--- Housing Equity Withdrawal-HEW--- Housing Starts--- HPI--- Hyperinflation---


    IBD/TIPP Economic Optimism Index--- ICCH=International Commodities Clearing House Limited--- ICSC--- ICSC-UBS Store Sales--- IEA--- IFEMA--- IFO--- ILO--- IMF--- IMM=International Monetary Market--- Implied Rates--- In-the-Money--- Inconvertible Currency--- Index Linking--- Index of Consumer Confidence--- Indicative Quote--- Indirect quote--- Industrial New Orders--- Industrial Production--- Industrial Production Index-IPI--- Inflation--- Info Quote--- Initial Margin--- Initial Margin Requirement--- Instruction--- Inter-dealer Broker--- Interbank Rates--- Interest Rate Futures--- Interest Rate Risk--- Intermarket Analysis--- International Capital flows= TIC flows--- International Merchandise Trade-Canada--- International Securities Dealers Association - ISDA--- International Swaps and Derivatives Association- ISDA--- Intervention--- Intra-Day limit--- Intra-Day Position--- Intraday--- Intrinsic Value--- Inverted Market--- Investment Lending--- Invisibles--- IOM--- IPI--- IPO--- ISDA - International Securities Dealers Association--- ISM--- ISM Manufacturing--- ISM Non-Manufacturing - United States--- ISO--- ISTAT--- Ivey Purchasing Managers Index (PMI) - Canada---


    Jawbone--- Job-to-applicant ratio --- Jobber --- Jobless Claims Change---Jurisdiction Risk---Juristiction---


    Key currency--- Kiwi---


    Labor Cash Earnings - Japan---Labour Productivity - Canada---Large Company---Large Retailers' Sales--Last Trading Day---Layoff--- lb--- LDC--- Lead--- Leading Indicator Index--- Leading Indicators--- Leads and Lags--- Left-hand Side--- Letter of Credit--- Leverage---Liability---LIBOR--- LIBOR - London Inter Bank Offer Rate--- Life of Contract---LIFFE--- Limit--- Limit Down--- Limit Move---Limit Order---Limit Up--- Limited Convertibility--- line of credit--- Liquid and Illiquid Markets--- Liquidity--- Liquidity Risk--- Local--- Locked Market--- London Inter Bank Offer Rate (LIBOR)---Long--- Long - Position--- Long Hedge --- Long/Short---Lot--- LSE---


    M0--- M1--- machin tool--- Maintenance---Majors--- Make a Marketake --- Managed Float--- Manufacturing I/S Ratio - Canada ---Manufacturing Shipments--- Margin--- Margin Call--- Marginal Risk--- Mark-to-Market--- Market Close--- Market Maker--- Market Order--- Market Rate--- Market Risk--- Market Timing--- Market Value--- Market-Maker---Markup--- Maturity--- Maturity Date---MBA--- Merchandise Trade Balance--- Micro economics--- Microcredit --- Mid-price or middle rate--- Mine and Yours--- Minimum price fluctuation---Mio--- MITI--- MM--- MOF--- Momentum--- Monetary Base-Japan--- Money Market--- Money market Instuments--- Money Supply---mortgage-backed security (MBS)-- Moving Average--- MPC-Marginal Propensity To Consumeo --- Mutual fund --


    n.s.a --- NAB--- NAHB--- NAPM--- NAPM-Chicago--- NAR--- NBNZ--- Negative or bearish divergence--- Net Position--- Net Worth--- New Housing Price Index - Canada--- Nickel--- NIESR--- Noise--- nominal--- Non Resident Bond Holdings - New Zealand --- Non-farm payroll--- Nostro Account--- Note--- NYSE--- NZIER---


    OCO - One Cancels the Other Order--- OCR-Official Cash Rate--- Odd Lot--- ODPM--- OECD--- Off-Balance Sheet--- Off-Shore--- Offer--- Offer - ask--- Official Reserve Assets - Japan--- official reserves--- Offset--- Offsetting transaction--- Offshore--- Old Lady--- One Cancels Other Order--- One Cancels the Other Order - OCO--- Open Market Operations--- Open Order--- Option--- Option Premium--- Option Class--- Option Series--- Options--- Order--- OTC - Over the Counter--- Out-of-the-Money--- Outperform---= Output--- Over the Counter - OTC--- Overall Household Spending--- Overbought--- Overheated /Economy--- Overnight Limit--- Overnight Position--- Overnight trading--- Oversold---


    Package Deal--- Par--- Parities--- Parity--- Participation Rate --- payroll--- Pegging--- Pending Home Sales Index--- Pending Order--- Performance--- Permitted Currency--- Personal Consumption Expenditure---Personal Consumption Expenditure (PCE) - United States--- Pip--- Pips--- Platform--- PMI--- PMI-New Zealand--- Point--- Political Risk--- Position--- Position - Long--- PPI--- Premium--- Price--- Price Transparency--- Primary market--- Prime Rate--- Prime Rate -US--- Principal--- Principal Value--- Private Capital Expenditure--- Private Consumption - Germany - Euro-zone--- Producer & Import Prices-switzerland--- Producer Price Index (Input) - UK--- Producer Price Index (Output) - UK--- productivity--- Profit Taking--- PSNCR--- public finances-UK--- Public Sector Net Borrowing - UK--- Purchasing Power Parity--- Put Call Parity--- Put Option---


    Quanto option--- Quote--- QV=Quotable Value New Zealand, Ltd---


    Rally--- Range--- Rate--Rate of Inflation---RBA---RBNZ--- RBNZ Official Cash Rate---Reaction--- Realized and Unrealized Profit--- Recession--- Recovery--- Rectangle--- Red book--- REINZ=Real Estate Institute of New Zealand--- Relative Return--- Relative Strength Index - RSI--- REPO -Repurchase--- Repurchase -REPO--- Reserve Currency---Reserve Requirements--- Reserves--- Resistance--- Resistance Point or Level--- Retail Outlet--- Retail Price Index--- Retail Trade--- Retail Trade Monthly - Japan--- Retracements--- Reuter Dealing---Revaluation--- Revenue--- Reversal--- RICS--- RICS House Price Balance--- Risk--- Risk Capital--- Risk Management--- Risk Position--- Risk Premium--- Risk-Adjusted Return--- Risks--- Roll-Over--- Rolling over--- Rollover---Round trip--- Rounding Top and Bottom-- RPI-Retail Price Index--- RSI - Relative Strength Index---


    S&P - Standard and Poors--- s.a--- Same day transaction--- same store sales--- SDR--- SEC--- SECO--- Secured Loan--- Securitization--- Sell Limit Order--- Sell Stop Order--- Selling Rate---Selling Short--- Selloff--- Series--- Session--- Settlement--- Settlement Date--- Settlement Risk--- Share--- Shop Price Index--- Short--- Short position--- Short sale--- Short Squeeze--- Short-term interest rates--- Sidelined--- Sideways--- SITC--- SL--- Slippage--- SNB--- SOFFEX--- Soft Market--- speculation--- Spike--- Spot--- Spot Market---Spot Commodity--- Spot Price---Spot Price/Rate--- Spread--- Square/Flat--- Squeeze---Stable Market--- Stagflation--- Stake--- Standard--- Standard and Poors - S&P--- Sterilization--- Sterling--- Stock Index--- Stocky--- Stop (loss) Order --- Stop Loss Order--- Stop Order or Stop--- Stop Out Price--- Stop-Loss order--- Straddle--- Strike Price---Strike Price- Exercise Price--- Strip--- Structural Unemployment--- Support Levels---SVME---Swap--- Swap price--- Swissy---


    T-Bill--- Take Profit Order---Takeover--- TD--- TD Securities--- Technical Analysis--- Technical Correction--- Terms of Trade--- Terms of Trade Index - New Zealand--- Tertiary Industry Index - Japan--- Theta---Thin Market--- Think Tank--- TIBOR--- TIC-Treasury International Capital-- Tick--- TIFFE--- Tight Money--- Time Deposit--- timing the market--- Today/Tomorrow--- Tom next - Tomorrow Next--- Tomorrow Next - Tom/Next--- TP--- Tradable amount --- Trade Date--- Trading day--- Trading Range--- Trading Volume--- Tranche---Transaction--- Tranasction Cost --- Transaction Date --- Transaction Exposure --- Trend Lines --- Triple Top--- Trust bank --- Truth in Lending --- Turnover---two-way market --- Two-Way Price --- Two-way quotation --- Two-Way Quote ---


    U.S. Dollar Index =USDX--- UBS Consumption Indicator - Switzerland --- Uncovered--- Under-Valuation --- Unit Labor Cost --- Unrealized Gain/Loss --- Unsecured Loan --- Up tick --- Uptick Rule --- USDX=U.S. Dollar Index --- Useable Margin ---


    Value added tax --- Value Date--- Value Spot --- Vanilla--- Variation Margin --- VAT--- Vega--- Velocity of Money --- Victoria Day --- Visible Trade Balance - UK --- VIX--- VOL - Volatility --- Volatility--- Volatility - VOL--- Volatility Swap --- Vostro Account --- Voting Stock ---


    Wage drift--- Warrant--- Wash trade--- wda--- Whipsaw--- Wholesale inventories--- Wholesale Money --- Wholesale Price Index--- Wire Transfer--- Work Force --- Working day --- World Bank--- Write Down--- Writer--- WTO---


    XAG--- XAU---


    Yard--- Year To Date - YTD --- Yield--- Yield Curve ---


    Z-Certificate --- Zero Coupon Bond--- ZEW--- ZEW Indicator of Economic Sentiment --- ZEW Survey - Euro Zone .
    Last edited by PCMAnalyst; 05-23-2014 at 02:53 PM.

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    ABC Consumer Confidence

    The U.S. Consumer Confidence Index (CCI) is an indicator designed to measure , which is defined as the degree of optimism on the state of the economy that consumers are expressing through their activities of savings and spending. Global consumer confidence is not measured.


    ABN AMRO is a Dutch bank, currently owned by RFS Holdings B.V., a consortium of Royal Bank Of Scotland Group, the Government of the Netherlands, and Banco Santander. The bankwas created as the result of the 1990-91 merger between Amsterdam-Rotterdam (AMRO) Bank and ABN whose history dated back to the founding of the Nederlandsche Handel-Maatschappij in 1824.
    Between 1991 and 2007, ABN AMRO was one of the largest banks and Europe and had operations in about 63 countries around the world.
    In the biggest banking takeover in history, a consortium comprising, RBS,Fortis,and the Dutch government nationalised the divisions owned by Fortis, while the UK government is now in effective control over the divisions allocated to RBS due to its financial bail-out of the Scottish bank. The process of integrating some of ABN AMRO's divisions into the new owners, and divesting others, continues.

    Absolute Return

    The return that an asset achieves over a certain period of time. This measure looks at the appreciation or depreciation (expressed as a percentage) that an asset - usually a stock or a mutual fund - achieves over a given period of time.
    Absolute return differs from relative return because it is concerned with the return of a particular asset and does not compare it to any other measure or benchmark.


    An arrangement by which an organization accepts a customer's financial assets and holds them on behalf of the customer at his or her discretion.

    A statement summarizing the record of transactions in the form of credits, debits, accruals and adjustments that have occurred and have an affect on an asset, equity, liability or past, present or future revenue.

    A relaying of happenings from one party to another.


    An arrangement by which an organization accepts a customer's financial assets and holds them on behalf of the customer at his or her discretion.

    A statement summarizing the record of transactions in the form of credits, debits, accruals and adjustments that have occurred and have an affect on an asset, equity, liability or past, present or future revenue.

    A relaying of happenings from one party to another.

    Accrual Bond

    A bond that does not pay periodic interest payments. Instead, interest is added to the principal balance of the bond and is either paid at maturity or, at some point, the bond begins to pay both principal and interest based on the accrued principal and interest to that point.


    The physical commodity that underlies a futures contract or is traded in the physical market. This is the homogeneous commodity that is the basis for trade, either through the physical market or a derivative contract such as oil, corn or gold.

    Adjustable Peg

    Exchange rate regimen where a currency's conversion rate is 'pegged' (fixed) in relation to a stronger currency (such as the US dollar or Euro). The pegged rate is adjusted occasionally in an attempt to improve the country's competitive position. This arrangement was the basis of the Bretton Woods system which prevailed during 1944 to 1971.


    A deduction made to charge off a loss, as with a bad debt.


    A unit of US-based Automatic Data Processing (ADP), Automatic Data Processing Limited, or ADP Europe, specializes in outsourced employer services such as payroll, benefits, and human resources management. It also offers information processing services for brokerage firms and car dealers. The company serves corporate clients throughout Europe and is one of the region's leading payroll services providers. ADP also does business in Europe through its ADP Clearing unit, which uses its MAESTRO software to process airline tickets worldwide.

    Advance Retail Sales-United States

    Consumer consumption in the U.S. is expected to improve for the second-consecutive month in June, with economists forecasting a 0.4% rise in retail sales, and the data could encourage an enhanced outlook for future growth as policymakers take unprecedented steps to stimulate the world’s largest economy. The international society of foreign exchange dealers consisting of national "Forex clubs" affiliated on a world wide basis.

    ADX-Average Directional Index

    An indicator used in technical analysis to determine the strength of a prevailing trend. The ADX is measured on a scale between zero and 100. Readings below 20 are used to indicate a weak trend, while readings over 40 indicate a strong trend. ADX is not used to determine the direction of a particular trend, but only to gauge its strength.

    After-Hours Trading

    After-hours trading (AHT) refers to the buying and selling of securities on major exchanges outside of specified regular trading hours. Both the New York Stock Exchange and the Nasdaq National Market operate from 9:30 a.m. to 4:00 p.m. EST. At one time limited to institutional investors and individual investors with high net worth, AHT is now an option for the average investor as well.

    Agent Bank

    A bank that has been authorized by an individual to act as his/her agent. An agent bank would typically provide services such as back-office operations, processing of credit applications, and verification services.

    Aggregate Demand

    A macroeconomic value equal to the sum of all personal consumption expenditures, business expenditures, and government expenditures in a particular time period.

    Aggregate risk

    The amount of exposure a customer has to the movement of spot contracts and forward contracts.

    Aggregate Supply

    A macroeconomic value equal to the sum of all goods and services produced in a particular time period.


    Some one who trade with Aggresive mode


    The percentage difference between the spot and forward rates of exchange between two countries.


    Gathering of the directors and stockholders (shareholders) of every incorporated firm, required by law to be held each calendar year. Generally, not more than 15 months are allowed to elapse between two AGMs, and a 21-day's written notice of its date is required to be given to the stockholders. The main purpose of an AGM is to comply with legal requirements, such as the presentation and approval of the audited accounts, election of directors, and appointment of auditors for the new accounting term. Other items that may also be discussed include compensation of officers, confirmation of proposed dividend, and issues raised by the stockholders. Called annual meeting in the US.


    American International Group, Inc. (AIG) (NYSE: AIG), a is an American insurance corporation. Its corporate headquarters are located in the American International Building in New York City. The British headquarters office is on Fenchurch Street in London; continental Europe operations are based in La Défense, Paris, and its Asian headquarters office is in Hong Kong. According to the 2008 Forbes Global 2000 list, AIG was once the 18th-largest public company in the world. It was listed on the Dow Jones Industrial Average from April 8, 2004 to September 22, 2008.

    All Industry Activity Index - Japan

    Evaluates the monthly change in overall production by all sectors of the Japanese economy. The Index comprises a variety of industries â?? service, manufacturing, construction and public sectors are all included. The index closely follows Japanese GDP and overall growth figures, providing insight into current levels of Japanese economic expansion. The All Industry Activity Index is posted monthly as a percentage change from the previous month's figure.

    American Option

    An option which can be exercised at any time between the purchase date and the expiration date. Most options in the U.S. are of this type. This is the opposite of a European-style option, which can only be exercised on the date of expiration. Since an American option provides an investor with a greater degree of flexibility than a European style option, the premium for an American style option is at least equal to or higher than the premium for a European-style option which otherwise has all the same features. also called American-style option.

    Anonymous Trading

    Visible bids and offers on the market without the identity of the bidder and seller being revealed.

    ANZ Commodity Price Index - New Zealand

    Measures the monthly price change of New Zealand 's seventeen main commodity exports. Given that the exports act as the driving force of New Zealand 's economy, changes in their prices can affect GDP and exchange rates. An increase in export prices may suggest a strengthening of the Dollar as foreigners pay relatively more for New Zealand 's exports. Conversely, falling export prices may indicate a decline in demand for New Zealand commodities; weakening the exchange rate.The headline value is the percentage change in the index from the previous month. Because the figure measures price changes in commodity goods, it acts as an early indicator of price changes. As such an early indicator the figure is useful in predicting future price direction.

    ANZ Job Advertisements - Australia

    The ANZ Bank job advertisement series measures the average weekly number of job advertisements placed in major metropolitan newspapers each months. for the ACT the series is based on the Number of job advertisements placed in The Canberra Times

    All or None

    A stipulation of a buy or sell order which instructs the broker to either fill the whole order or don't fill it at all; but in the latter case, don't cancel it, as the broker would if the order were fill or kill.


    An increase in the value of an asset over time. The increase can occur for a number of reasons including increased demand or weakening supply, or as a result of changes in inflation or interest rates. This is the opposite of depreciation, which is a decrease over time.


    The simultaneous purchase and sale of an asset in order to profit from a difference in the price. This usually takes place on different exchanges or marketplaces.
    Also known as a "riskless profit".

    Arbitrage channel

    The range of prices within which there will be no possibility to arbitrage between the cash and futures market.

    Ascending Triangles

    A price-chart pattern that indicates that a market is consolidating and is about to break out to either the upside or downside. Ascending triangles are identified by charting the closing prices of a stock, futures contract or other financial instrument in a technique called technical analysis.

    Asian Option

    The style or family of a financial option is a general term denoting the class into which the option falls, usually defined by the manner in which the option may be exercised. The two great families are european and american.


    The price a seller is willing to accept for a security, also known as the offer price. Along with the price, the ask quote will generally also stipulate the amount of the security willing to be sold at that price.

    Ask Price

    Ask price, also called offer price, offer, asking price, or simply ask, is a price a seller of a good is willing to accept for that particular good.In bid and ask, the term ask price is used in contrast to the term bid price. The difference between the ask price and the bid price is called the spread.

    Ask Rate

    The lowest price at which a financial instrument is offered for sale

    Ask Size

    The number of shares that are being offered for sale at the ask price, often expressed in terms of hundreds of shares.


    Offer is the price for traders to Sell the currency. In bid and ask / offer prices, the bid price stands in contrast to offer the price, or “tender”, and the difference between the two is called the bid/offer spread.


    This converts particular assets of a company into liquid cash in exchange for a security interest to be paid to a bank or a financing company.

    Asset Allocation

    An investment strategy that aims to balance risk and reward by apportioning a portfolio's assets according to an individual's goals, risk tolerance and investment horizon.
    The three main asset classes - equities, fixed-income, and cash and equivalents - have different levels of risk and return, so each will behave differently over time.

    Asset Swap

    Similar in structure to a plain vanilla swap, the key difference is the underlying of the swap contract. Rather than regular fixed and floating loan interest rates being swapped, fixed and floating investments are being exchanged.


    Assets are bought to increase the value of a firm or benefit the firm's operations. You can think of an asset as something that can generate cash flow, regardless of whether it's a company's manufacturing equipment or an individual's rental apartment.

    Association Cambiste Internationale

    The international society of foreign exchange dealers consisting of national "Forex clubs" affiliated on a world wide basis.

    AT Best

    An instruction to a broker or dealer to get the best price or rate that he/she is able to at that time.

    At or Better

    A type of securities or commodity order that specifies that the transaction occur only at the specified price or better.

    At Par Forward Spread

    A type of spread in which the spot price and the forward price of an option are equal.

    At the Price Stop-Loss Order

    A type of stop-loss order for which the transaction must be executed at specific price. At the price stop-loss orders are executed regardless of the market conditions.


    A condition in which the strike price of an option is equal to (or nearly equal to) the market price of the underlying security.


    An auction in which an item is initially offered at a high price that is progressively lowered until a bid is made and the item sold.

    Auction- Rate Securities

    A method for selling an asset to the highest bidder.


    Similar to how the U.S. dollar is sometimes called the greenback or the Canadian dollar is called the loonie, the Australian dollar is sometimes called the Aussie to distinguish it from all the other dollars. It is also denoted as A$ or AU$.

    Authorized Dealer

    Any type of financial institution that has received authorization from a relevant regulatory body to act as a dealer involved with the trading of foreign currencies. Dealing with authorized forex dealers ensure that your transactions are being executed in a legal and just way.
    Last edited by PCMAnalyst; 04-21-2014 at 10:38 PM.

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    To withdraw from a position.

    Back Office

    Administration and support personnel in a financial services company. They carry out functions like settlements, clearances, record maintenance, regulatory compliance, and accounting. When order processing is slow due to high volume, it is commonly referred to as "back office crunch."

    Back Testing

    The process of testing a trading strategy on prior time periods. Instead of applying a strategy for the time period forward, which could take years, a trader can do a simulation of his or her trading strategy on relevant past data in order to gauge the its effectiveness.
    Most technical-analysis strategies are tested with this approach.

    Back to Back

    An intercompany loan channeled through a bank.


    A theory developed in respect to the price of a futures contract and the contract's time to expire. Backwardation says that as the contract approaches expiration, the futures contract will trade at a higher price compared to when the contract was further away from expiration. This is said to occur due to the convenience yield being higher than the prevailing risk free rate.

    Bail Out

    A situation in which a business, individual or government offers money to a failing business in order to prevent the consequences that arise from a business's downfall. Bailouts can take the form of loans, bonds, stocks or cash. They may or may not require reimbursement.


    Balance Finance is here to provide an alternative home finance solution for “Everyone Everyday” that includes Salary Earners, Tradesman, Contractors, Business Owners, Investors, or even First Home Buyers, either way our goal is to help you achieve your goal as smoothly as possible.

    Balance of Trade

    The difference in value between the total exports and total imports of a nation during a specific period of time.


    A systematic record of a nation's total payments to foreign countries, including the price of imports and the outflow of capital and gold, along with the total receipts from abroad, including the price of exports and the inflow of capital and gold.


    A thin strip of flexible material used to encircle and bind one object or to hold a number of objects together.

    Bank for International Settlements- BIS

    The Bank for International Settlements (BIS) is a banker's bank. BIS serves the world's central banks as well as other official monetary institutions and nations. Serving some 140 financial institutions, BIS promotes cooperation among central banks, conducts economic research, and offers asset management, money market instruments, fixed-rate investments, foreign exchange, and short-term credit. The bank does not offer financial services to individuals or corporations. In addition to its head office in Basel, Switzerland, the bank has representative offices in Hong Kong and Mexico City. Founded in 1930, BIS is one of the world's oldest international financial institutions.

    Bank holiday

    A bank holiday is a public holiday in both the United Kingdom and Ireland. There is some automatic right to time off on these days, although the majority of the population not employed in essential services (e.g. utilities, fire, ambulance, police, health-care workers, London Underground) receive them as holidays; those employed in essential services usually receive extra pay for working on these days. Bank holidays are often assumed to be so called because they are days upon which banks are shut, but this is not in fact the case. Some of the assumed bank holidays are days on which the banks are shut but are not, in fact, a bank holiday (e.g. Good Friday and Christmas Day). Legislation does not allow certain payments to be deferred to the working day.

    Bank Lending - Japan

    The value of all outstanding loans with Japanese banks. Bank lending is important because lending increases with increased business confidence and investment. It is particularly insightful for the Japanese economy because of the weakness that has plagued the Japanese banking sector. The headline number is for total loans and discounts and is a percentage change from the previous year.

    Bank Line

    Bank's moral commitment to lend, as distinct from its contractual, legal, commitment; alternate name for a Line of Credit. A bank line is an indication of a bank's willingness to lend to a particular borrower up to a predetermined amount, usually for working capital purposes, and for a one-to-three-year period. The line is renewable at the option of the lender, so long as the borrower meets certain conditions, for example, agreeing to keep a portion of the line in a Compensating Balance with the lender to maintain the business in sound financial condition.

    Bank Notes

    Note issued by a bank representing its promise to pay a specific sum to the bearer on demand and acceptable as money. Also called bank bill.

    Bank of England Meeting Minutes - United Kingdom

    The Bank of England Monetary Policy Committee keeps notes from its rate decision meetings. The detailed minutes from these meetings give some of the best insight into the monetary policy decision making process and what the BOE thinks about economic developments inside and outside of the UK. Markets tend to focus most of their attention on the key points discussed during the meeting that suggest future interest rate changes. For example if the minutes state that high consumer spending and a rapidly expanding housing market are fueling inflation, then markets participants will tend to monitor these key sectors closely in order to gauge the likelihood of a rate increases in the future.

    Bank Rate

    The rate of discount established by a country's central bank.

    Bar Chart

    A graph consisting of parallel, usually vertical bars or rectangles with lengths proportional to the frequency with which specified quantities occur in a set of data. Also called bar chart.

    Base Currency

    Base Price

    A base price is the price of the cost of a new car without getting any other options, just standard options. Nothing optional or anything like that.

    Base Rate

    In probability and statistics, base rate generally refers to the (base) class probabilities unconditioned on featural evidence, frequently also known as prior probabilities. For example, if it were the case that 1% of the public are "medical professionals" and 99% of the public are not "medical professionals," then the base rates in this case are 1% and 99%, respectively.


    A fortified center of operations.


    In linear algebra, a basis is a set of vectors that, in a linear combination, can represent every vector in a given vector space or free module, and such that no element of the set can be represented as a linear combination of the others. In other words, a basis is a linearly.

    Basis Convergence

    The process whereby the basis tends towards zero as the contract expiry approaches.

    Basis Point

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly used for calculating changes in interest rates, equity indexes and the yield of a fixed-income security.

    Basis Price

    Price quotation for a security expressed in terms of yield to maturity. This will usually only be quoted on fixed-income securities such as bonds.

    Basis Trading

    Basis trading is an arbitrage strategy usually consisting of the purchase of a particular security and the sale of a similar security (often the purchase of a security and the sale of a corresponding futures contract).


    An item resembling such a container in shape or function.


    The leading trade association that represents the views of those involved in the banking and financial services industry within the U.K.

    BCI-Business Cycle Indicator

    Composite of leading, lagging and coincident indexes created by the Conference Board and used to forecast changes in the direction of the overall economy of a country. They can be used to confirm or predict the peaks and troughs of the business cycle and are published for the U.S., Mexico, France, the U.K., South Korea, Japan, Germany, Australia and Spain.


    An investor who believes that a particular security or market is headed downward. Bears attempt to profit from a decline in prices. Bears are generally pessimistic about the state of a given market.

    Bear Call Spread

    A type of options strategy used when a decline in the price of the underlying asset is expected. It is achieved by selling call options at a specific strike price while also buying the same number of calls, but at a higher strike price. The maximum profit to be gained using this strategy is equal to the difference between the price paid for the long option and the amount collected on the short option.

    Bear Market

    A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment to be self-sustaining. As investors anticipate losses in a bear market and selling continues, pessimism only grows. Although figures can vary, for many, a downturn of 20% or more in multiple broad market indexes, such as the Dow Jones Industrial Average (DJIA) or Standard & Poor's 500 Index (S&P 500), over at least a two-month period, is considered an entry into a bear market.

    Beige Book - United States

    Report on current economic conditions in each of the 12 Federal Reserve districts covering the entire US. Regional Banks in the Federal Reserve System gather anecdotal information based on surveys of executives, economist and market participants. The Beige Book summarizes this data into a relatively short document, giving a picture of economic trends and challenges faced by different parts of the nation. In addition to providing useful information on the economy, the report is also a window into how FOMC members may vote at the next interest rate policy meeting. Because each report is based on anecdotal information as much as statistics, it is subjective and may reflect opinions of district governors. As the only comprehensive report made available to the public, the Beige Book provides a rare opportunity for markets to better understand the Federal Reserve and its views on the economy.


    An offer made by an investor, a trader or a dealer to buy a security. The bid will stipulate both the price at which the buyer is willing to purchase the security and the quantity to be purchased.

    Bid Price

    The price a buyer is willing to pay for a security. This is one part of the bid with the other being the bid size, which details the amount of shares the investor is willing to purchase at the bid price. The opposite of the bid is the ask price, which is the price a seller is looking to get for his or her shares.

    Bid-Offer Spread

    The bid/offer spread (also known as bid/ask or buy/sell spread) for securities (such as stock, futures contracts, options, or currency pairs) is the difference between the price quoted by a market maker for an immediate sale (bid) and an immediate purchase (ask). The size of the bid-offer spread in a given commodity is a measure of the liquidity of the market and the size of the transaction cost.

    Bid/Ask Spread

    The amount by which the ask price exceeds the bid. This is essentially the difference in price between the highest price that a buyer is willing to pay for an asset and the lowest price for which a seller is willing to sell it.

    Big Figure

    The stem, or whole dollar price, of a quote, often used in reference to foreign currencies or money markets.

    Bilateral Clearing

    The system of annual settlements of accounts between certain countries, where accounts are settled by the central banks.

    BIS - Bank for International Settlements

    The bis is an international organisation which fosters cooperation among central banks and other agenicies in pursuit of monetary and financial stability . its bank services are provide exculsively to central banks and international organisations.

    Black-Scholes Model

    A financial model of the variations over time in (for example) the price of stocks on the stock market. The model, proposed in 1974, is based on the notion that the underlying price variations could be modelled as Brownian motion.

    Blocked Currency

    Any currency that is mainly used for domestic transactions and does not freely trade on a forex market (usually due to government restrictions). Also referred to as a "nonconvertible currency".

    A book containing daily records of occurrences or transactions.

    blue chips

    A stock that sells at a high price because of public confidence in its long record of steady earnings.

    BoC=Bank of Canada

    The central bank of Canada, that came into existence after the passing of the Bank of Canada Act in 1935, influences the country's economy and money supply.

    BoJ=Bank of Japan

    Founded in 1882 as Japan's central bank, the Bank of Japan primarily issues banknotes and acts as a treasurer for the government. It is responsible for implementing lending rate changes as well as maintaining fluctuations in reserve requirements. The bank's mission is also to compile data and perform research and analysis pertaining to the overall economy. The Bank of Japan maintains a so-called "quantitative easing monetary policy" within the nation's economy, meaning it injects the financial market with excess funds hoping to stimulate economic recovery; however, due to some criticism, the bank might be tightening its fiscal policies in the future.

    Bollinger Bands

    Because standard deviation is a measure of volatility, Bollinger bands adjust themselves to the market conditions. When the markets become more volatile, the bands widen (move further away from the average), and during less volatile periods, the bands contract (move closer to the average). The tightening of the bands is often used by technical traders as an early indication that the volatility is about to increase sharply.


    A debt instrument issued for a period of more than one year with the purpose of raising capital by borrowing.


    A set of written, printed, or blank pages fastened along one side and encased between protective covers.


    Reserved in advance; held for future use. See reserve


    A systematic record of a nation's total payments to foreign countries, including the price of imports and the outflow of capital and gold, along with the total receipts from abroad, including the price of exports and the inflow of capital and gold.


    Promotion reply postcard preaddressed to the mailer and usually sent as permit mail, requiring no postage payment by the responder. Mailers pay a fee of approximately $400 per year for a business reply permit. Business reply cards, which are mailed at First-Class postage rates.

    BRC Shop Price Index - UK

    A monthly indicator of price changes at the most popular retail outlets in the United Kingdom. The index takes into account five hundred of the most commonly purchased goods and gives insight into consumer-price inflation. Shop Prices differentiate themselves from British CPI by coming out days before the headline inflation figure. Increases in the BRC Shop Price Index are bullish for the Pound, given that the Bank of England usually raises interest rates to control inflation reflected in the BRC. Conversely, a falling BRC Shop Price Index suggests falling price pressures.

    Break Out

    Technical analysis term used to describe price action rising above resistance or dropping below support. Breakouts may come through the continuation of an exiting natural trend, or after new information has been made available to the market

    Break-Even Point

    The price at which an option's cost is equal to the proceeds acquired by exercising the option. For a call option, it is the strike price plus the premium paid. For a put option, it is the strike price minus the premium paid.

    Bretton Woods

    An agreement struck in the summer of 1944, in which the U.S., the U.K., and their wartime allies set up the rules for the post-World War II monetary system. The meeting set the structure for the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), which in the U.S. is more commonly known as the World Bank.

    Bretton Woods Accord of 1944

    The Bretton Woods Accord was established in 1944, towards the end of World War II. The United Nations Monetary Fund convened in Bretton Woods, New Hampshire, with representatives from the United States, Great Britain and France. The Bretton Woods Accord established the policy of pegging currencies against the U.S. dollar in order to stabilise the global economy. It set fixed exchange rates for major currencies and subsequently established the International Monetary Fund (IMF).Up until WWII, the British Pound was the the dominant world currency by which most currencies were compared. However, during World War II the Nazis undertook a major counterfeiting effort against the British Pound, and thus damaged it's standing. In contrast, WWII transformed the U.S. dollar from a failed currency after the stock market crash of 1929 to benchmark currency by which most other international currencies were compared. The U.S. economy was thriving, and the United States emerged as a world economic power. The first element of the Bretton Woods Accord was to peg the U.S. dollar to the price of gold at $35.00 an ounce, using the Gold Standard. With this benchmark anchoring the U.S. dollar, other major currencies were pegged to it and allowed to fluctuate no more than 1% on either side of the set standard. When a currency's exchange rate would approach the limit on either side of this standard the respective nation's central bank would intervene to bring the exchange rate back into the accepted range. The Bretton Woods Accord governed currency relationships until the early 1970's when a floating exchange rate system was adopted.

    British Retail Consortium-BRC

    Trade association for the UK retail industry. Includes news, details of policy work, events, and business information.

    Broad Liquidity

    A category of the money supply which includes: all funds in M3, individual holdings in accounts, savings bonds, T-bills with maturity of less than one year, commercial papers, and banker's acceptances.

    Broken Dates

    Term used in Foreign Exchange trading and the Euromarket for a forward exchange contract or money market contract with delivery of currency, CDs, and so on, to take place on a nonstandard date; for example 28 days instead of 30 days. Also called cock date.


    An individual or firm which acts as an intermediary between a buyer and seller, usually charging a commission. For securities and most other products, a license is required.


    Used interchangeably with broker when referring to a firm rather than an individual. also called brokerage house or brokerage firm.


    Government legislation that was created in 1970 to prevent financial institutions from being used as tools by criminals to hide or launder their ill-gotten gains. This is achieved by requiring banks and other financial institution to provide documentation (such as currency transaction reports) whenever clients deal with transactions that involve substantial sums of money ($10,000 or more) that appear to be suspicious. This way, authorities have the ability to easily reconstruct the entire situation.


    British Standards Institution wants to help keep business practices and products up to snuff. Doing business as BSI Group, the not-for-profit enterprise works with industry leaders and international groups to set and maintain industry standards. Its British Standards unit helps draft and market both UK and international specifications and guidelines, such as ISO standards. Its Management Systems unit offers certification services to customers in more than 120 countries, and BSI Product Services tests products in a wide range of industries. The group also provides training services and conducts conferences. BSI Group was founded in 1901.


    Nickname given to Bundesbank, the Central Bank of Germany.


    An investor who believes that a particular security, a sector, or the overall market is about to rise. opposite of bear.

    Bull Market

    A prolonged period in which investment prices rise faster than their historical average. Bull markets can happen as a result of an economic recovery, an economic boom, or investor psychology. The longest and most famous bull market is the one that began in the early 1990s in which the U.S. equity markets grew at their fastest pace ever. opposite of bear market.


    Bond issued in pounds sterling on the London market outside the U.K. Category: Financial affairs - taxation - customs • u-bolt with specially shaped sheeve used to clamp together two wire ropes Category: agriculture, fisheries, forestry - food processing industries • the foreign market in the United Kingdom.


    German central bank with headquarters in Frankfurt. Like the US Federal Reserve System (The Fed), it is owned by private banks.

    Business Climate

    General economic environment comprising of the attitude of the government and lending institutions toward businesses and business activity, attitude of labor unions toward employers, current taxation regimen, inflation rate, and such.

    Business Conditions Survey

    A survey of businesses in the manufacturing industry that gives an early indication of price direction, employment levels, and general business conditions. The survey covers manufacturers in the Third Federal Reserve District, which is headquartered in Philadelphia and includes the eastern two-thirds of Pennsylvania, southern New Jersey, and Delaware. The data is released at the end of the month that has been surveyed. Traders in the financial markets pay attention to the survey because it may give early insight into what other, broader manufacturing surveys, such as the ISM Index, will show. However the Philadelphia Fed Survey usually isnÂ’t a market-moving release. The data is presented as a diffusion index for current conditions and a six-month outlook
    Business Cycle Indicator-BCI

    Composite of leading, lagging and coincident indexes created by the Conference Board and used to forecast changes in the direction of the overall economy of a country. They can be used to confirm or predict the peaks and troughs of the business cycle and are published for the U.S., Mexico, France, the U.K., South Korea, Japan, Germany, Australia and Spain.

    Business Inventories

    A detailed, itemized list, report, or record of things in one's possession, especially a periodic survey of all goods and materials in stock.

    Buy and Hold

    A passive investment strategy in which an investor buys stocks and holds them for a long period of time, regardless of fluctuations in the market. An investor who employs a buy-and-hold strategy actively selects stocks, but once in a position, is not concerned with short-term price movements and technical indicators.

    buy in

    Options trading: procedure whereby the responsibility to deliver or accept stock can be terminated. In a transaction called buying-in or closing purchase , the writer buys an identical option (only the premium or price is different). The second of these options offsets the first, and the profit or loss is the difference in premiums.Securities: transaction between brokers wherein securities are not delivered on time by the broker on the sell side, forcing the buy side broker to obtain shares from other sources

    Buy Limit Order

    To avoid buying or selling a stock at a price higher or lower than you wanted, you need to place a limit order rather than a market order. A limit order is an order to buy or sell a security at a specific price. A buy limit order can only be executed at the limit price or lower, and a sell limit order can only be executed at the limit price or higher. When you place a market order, you can't control the price at which your order will be filled.

    Buy On Margin

    Buying an asset by making an initial payment-called the Margin-and borrowing the balance needed to cover the purchase price from a bank or broker. When securities or commodities are purchased on margin, there is no need to borrow any funds from a bank or broker to cover the rest of the cost. The margin represents a down payment. There are numerous examples: buying a house by making a down payment and financing the rest through a mortgage, buying securities through a broker, and so on. In securities purchasing, the amount of margin needed is regulated by the Federal Reserve Board.

    Buy stop

    Always placed above the current market price.Used to limit the potential loss on a short position.

    Buy Stop Order

    An order to buy a security which is entered at a price above the current offering price. It is triggered when the market price touches or goes through the buy stop price.

    Buyer's Market

    A market condition characterized by low prices and a supply of commodities exceeding demand

    Buying Rate

    The price of one country's currency expressed in another country's currency. In other words, the rate at which one currency can be exchanged for another. For example, the higher the exchange rate for one euro in terms of one yen, the lower the relative value of the yen.

    Buying Selling FX

    foreign exchange (FX) The currencies of foreign countries, as bought and sold on a foreign-exchange markets. Firms or organizations require foreign exchange to purchase goods from abroad or for purposes of investment or speculation.
    Last edited by PCMAnalyst; 04-23-2014 at 10:17 AM.

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    Letter- C


    In the context of the forex market, the exchange rate between the U.S. dollar and the British pound sterling. Because it is the norm in forex for most major currencies to be quoted against the U.S. dollar on a regular basis, "cable" is a commonly used term.

    "Cable" can also be used to refer simply to the British pound sterling.

    Cable Transfer

    The origins of this term are attributed to the fact that in the 1800s, the dollar/pound sterling exchange rate was transmitted via transatlantic cable.Forex brokers are sometimes referred to as "cable dealers".


    Monetary unit of the United Kingdom, including Great Britain.

    Spread">Calendar Spread

    An options or futures spread established by simultaneously entering a long and short position on the same underlying asset but with different delivery months. Sometimes referred to as an interdelivery, intramarket, time or horizontal spread.


    In some exchanges, the call period is an important time in which to match and execute a large number of orders before opening and closing. A call becomes more valuable as the price of the underlying asset (stock) appreciates.

    Call Option

    An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument at a specified price within a specific time period

    Call Rate

    Call rate is the inter-bank interest rate on funds that are not deposited for a fixed period. It relates to amount deposited for an indefinite time with a bank.


    A banker; a money changer or broker; one who deals in bills of exchange, or who is skilled in the science of exchange.

    Candlestick Chart

    A candlestick chart is a style of bar-chart used primarily to describe price movements of an equity over time.It is a combination of a line-chart and a bar-chart, in that each bar represents the range of price movement over a given time interval. It is most often used in technical analysis of equity and currency price patterns. They appear superficially similar to error bars, but are unrelated.


    Small public companies having a market capitalization below $50 million.

    Cap-An abbreviation for capitalization

    You will hear companies referred to as "small-cap", "mid-cap" and "large-cap". You will also hear about "micro-caps", which are even smaller than small-caps. "Cap" isn't as mysterious as it sounds: it's definition is short for "capitalization", which is the total value of the corporation's existing stock. If my hypothetical, nanno-micro-cap has 200 shares and trades at $8 a share, you could define my market cap as a whopping $1,600. As you can see, the market cap of a company can change from moment to moment as its share prices rise and fall on the tides of time. Because it's based on what people expect to come about, (people pay for stock).

    when they think its value will increase), it's somewhat arbitrary. But, because the entire stock market is based on things like consumer confidence and supply and demand, it's also somewhat arbitrary, although it still manages to operate like something real, and brings about tangible rewards and successes to the ones who play the game.

    Capacity utilization

    Capacity utilization is a concept in economics which refers to the extent to which an enterprise or a nation actually uses its installed productive capacity. Thus, it refers to the relationship between actual output that 'is' produced with the installed equipment and the potential output which 'could' be produced with it, if capacity was fully used.

    Capacity Utilization Rate - Canada

    A metric used to measure the rate at which potential output levels are being met or used. Displayed as a percentage, capacity utilization levels give insight into the overall slack that is in the economy or a firm at a given point in time. If a company is running at a 70% capacity utilization rate, it has room to increase production up to a 100% utilization rate without incurring the expensive costs of building a new plant or facility.

    Capex-Capital Expenditure

    Capital Expenditures Refers to the cost of developing a product or system. OPEX (operating expenditures) are the ongoing costs for running it. For example, the purchase of a printer is the CAPEX, and the annual paper and ink cost is the OPEX. For larger systems, OPEX may also include the cost of human operators and facility expenses such as rent, electricity, heating and air conditioning.

    Capital Investment-Germany

    In times of a continuously expanding proliferation of investment and financing possibilities in the hands of banks, investment funds and individual capital investors, particular attention should be paid to the effects that new financial instruments are likely to have not only on concrete financing and investing modes but also on the further development of legal rules in this field. As the German capital market has been considered unable - at least until the widely marketed Deutsche Telekom IPO - to get rid of its persisting prejudice of being structurally lagging behind other countries' systems (2), the legal treatment of emerging financial instruments deserves greatest attention. (3) The rocket science of new financial instruments challenges law's aim to rightly assess the real quality of these instruments and to strike an adequate balance between the interests involved against a national policy background and EU demands. (4) While the past few years have been a time of great legislative activity in the field of company and capital market law in Germany (5), only a closer look at court decisions reveals the true pressure resulting from a fast moving capital market on traditional legal perceptions. The so-called Aktienanleihe-Decision by the Federal Court of Justice, [FCJ] (Bundesgerichtshof - BGH) of 12 March 2002 marks an important step in the ongoing process of Germany's developing capital market law.

    Capital Account

    An account stating the amount of funds and assets invested in a business by the owners or stockholders, including retained earnings.
    A statement of the net worth of a business at a given time.

    capital expenditure -CAPEX

    Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings or equipment. This type of outlay is made by companies to maintain or increase the scope of their operation. These expenditures can include everything from repairing a roof to building a brand new factory.

    Capital Flow

    Owner's share in a business plus operating profit or surplus, financing its long-term growth. Also called contributed capital or owner's equity. See alsoNet Worth; Paid-in Capital.

    Capital Gain

    The amount by which proceeds from the sale of a capital asset exceed the original cost.

    Capital Loss

    Capital loss is the difference between a lower selling price and a higher purchase price, resulting in a financial loss for the seller. Pursuant to IRS TAX TIP 2009-35 "If your capital losses exceed your capital gains, the excess can be deducted on your tax return, up to an annual limit of $3,000 ($1,500 if you are married filing separately)."

    Capital Markets

    Markets where capital, such as stocks and bonds, are traded.

    Capital Risk

    The risk an investor faces that he or she may lose all or part of the principal amount invested. The risk a company faces that it may lose value on its capital. The capital of a company can include equipment, factories and liquid securities.

    Capital Spending

    Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings or equipment. This type of outlay is made by companies to maintain or increase the scope of their operation. These expenditures can include everything from repairing a roof to building a brand new factory.


    The investor who might practice capping is a call option writer. If practicing capping, he or she is trying to avoid having to transfer the underlying security or commodity to the option holder. The goal is to have the option expire worthless so that the premium initially received by the writer is protected.


    A futures market in which the price difference between contracts with two different delivery months equals the full cost of carrying the commodity from the delivery month of the first contract to the next. Carrying costs include interest, insurance and storage. Also known as "full carry market" or "full carrying charge market".

    Carry Trade

    A strategy in which an investor sells a certain currency with a relatively low interest rate and uses the funds to purchase a different currency yielding a higher interest rate. A trader using this strategy attempts to capture the difference between the rates - which can often be substantial, depending on the amount of leverage the investor chooses to use.

    Carry-Over Charge

    The carry-over charge is one of the finance charges that is associated with the storage of commodities or foreign exchange contracts. Specifically, a carry-over charge is applied when the original delivery date on the commodity is revised to a later date. The exact amount of the charge is determined by several factors, including the amount of time involved between the original and revised delivery date, and any shifts in costs of maintenance of the commodity during that time frame.


    Money in the form of bills or coins; currency. Payment for goods or services in currency or by check.

    Cash and Carry
    Sold for cash, usually without delivery service.

    Cash Market

    A cash market may take the following forms: self-regulated centralized markets, such as commodity exchanges; decentralized over-the-counter markets where private transactions may occur; or localized community organizations, such as grain elevators. At these locations, you can purchase the actual physical commodity rather than just the futures contract.

    Cash Settlement

    A settlement method used in certain future and option contracts whereby, upon expiry or exercise, the seller of the financial instrument does not deliver the actual but transfers the associated cash position.


    A survey of senior manufacturing executives on trends in output, prices, exports, and costs.

    CBI Industrial Trends Survey - UK

    The CBI Industrial Trends Survey collects data on topics like current business confidence, capacity utilization, and investment intentions. The survey differs from most other economic surveys in that it focuses on the opinions of executives rather than quantitative data.


    First there was one. The Chicago Board Options Exchange (CBOE) may no longer be the only options exchange, but it's still the US leader in overall volume. Member-owned and founded in 1973 by the Chicago Board of Trade (which is now part of CME Group), CBOE lists options on more than 1,900 stocks, as well as on interest rates, broad-based stock indexes (such as Standard & Poor's S&P 500 Index), and industry indexes. CBOE, which had already launched the fully electronic CBOE Futures Exchange, debuted its CBOE Stock Exchange in early 2007, going head-to-head with the New York Stock Exchange and NASDAQ. CBOE also runs The Options Institute, which trains brokers and investors in all aspects of options

    CBOT or CBT

    Chicago Board of Trade (CBOT) is one of the busiest commodities exchanges in the world. The Board of Trade has more than 3,600 members, who trade almost 50 different futures and options products, including U.S. Treasury bonds, silver, soy beans, wheat, and Dow Jones Industrial Average futures. Annual trading volume is more than 200 million contracts. The CBOT operates as a not-for-profit corporation run by its members and a Board of Directors. Trades are accomplished through a so-called open outcry system, where traders meet face-to-face to make transactions in trading rooms known as pits. The CBOT adopted a computerized trading system for some trades in the late 1990s. Open outcry trading fell out of use at other leading exchanges in the 1990s, and the future of CBOT's trading pits was increasingly called into question. By the early 2000s, the future direction of the CBOT was still under consideration. The CBOT announced a decision to transform itself into a for-profit corporation with two separate trading areas, one electronic and one open outcry. This restructuring was bogged down by negotiation and litigation between the CBOT and the other Chicago exchanges, the Chicago Board Option Exchange and the Chicago Mercantile Exchange, and by indecision on the part of CBOT members and executives. As of March 2001, the CBOT planned to move ahead with restructuring and to form an alliance with the electronic German/Swiss exchange Eurex.

    Central Bank

    A nation's principal monetary authority, such as the Federal Reserve Bank, which regulates the money supply and credit, issues currency, and manages the rate of exchange.

    CEO=Chief Executive Officer

    Abbreviated as CEO. The executive who is responsible for a firm's operations, generally the President or the Chairman of the Board.

    Certificate of Deposit

    A certificate from a bank stating that the named party has a specified sum on deposit, usually for a given period of time at a fixed rate of interest.


    Uniform duty rate (customs duty) adopted by a common market or trading pact group to be assessed on imports from countries outside that market or group.

    CFD=Contract For Difference

    An arrangement made in a futures contract whereby differences in settlement are made through cash payments, rather than the delivery of physical goods or securities.


    The Commodity Futures Trading Commission (CFTC) tries to ensure the integrity of the commodity and financial futures markets. It protects the public and market users from fraud, manipulation, and abusive practices while fostering an open marketplace for trading commodity futures as well as foreign currency, US and foreign government securities, and US and foreign stock indices. CFTC develops trading policy, conducts research, evaluates filings, investigates fraud and manipulation, and prosecutes violators from offices in Chicago; New York; Kansas City, Missouri; and Washington, DC. Congress created the independent agency in 1974.

    CGPI -Capital Goods Price Index

    Measures the rate of inflation experienced by corporations. This data is based on a fixed baskets of goods and services and is calculated on a month-by-month basis.


    Clearing House Automated Payment System. A company that operates a computer system to perform clearing services for funds and some other investment vehicles denominated in the British pound. It is allied with other clearing houses in the Association for Payment Clearing Services. It began operations in 1984.


    A person who uses charts for technical analysis System in the UK for making cash payments in sterling. The recipient receives same day funds.


    Clearing House Interbank Payment System (CHIPS) Electronic means of settling banking payments in New York.

    The rate at which the banks lend the Danish krone on an unsecured basis. The rate is calculated daily by the Danmarks Nationalbank.

    Civic Federation

    The Civic Federation is a non-partisan government research organization working to maximize the quality and cost-effectiveness of government services in the Chicago region.

    Claimant Count Rate

    The Housing Market Index is data from a survey of home builders reflecting single-family home sales on the present, the next six months and traffic from prospective buyers. This composite index indicates housing market trends. This provides a gauge of not only the demand for housing, but consumer sentiment as well. Furthermore, this narrow piece of data has a powerful multiplier effect through the economy, and therefore across the markets and investments. Each time the construction of a new home begins, it translates to more construction jobs, and income which will be pumped back into the economy. Once a home is sold, it generates revenues for the home builder and the realtor. It brings a myriad of consumption opportunities for the buyer. Refrigerators, washers, dryers and furniture are just a few items new home buyers might purchase. The economic "ripple effect" can be substantial especially when you think a hundred thousand new households around the country are doing this every month.

    Clean float

    Market condition in which the value of a nation's currency in relation to other currencies is determined purely by free market forces. There are almost no cleanly floating Western currencies, i.e., currencies that are not supported one way or another through Intervention by central banks. Currencies that trade with a minimum of intervention by central banks or central monetary authorities are the Swiss franc, the German deutschmark, and the Canadian dollar.


    The procedure by which an organization acts as an intermediary and assumes the role of a buyer and seller for transactions in order to reconcile orders between transacting parties.

    clearing house

    An agency or separate corporation of a futures exchange responsible for settling trading accounts, clearing trades, collecting and maintaining margin monies, regulating delivery and reporting trading data. Clearing houses act as third parties to all futures and options contracts - as a buyer to every clearing member seller and a seller to every clearing member buyer.

    Closing a Position

    The act of taking the opposite position of the current position thereby getting out of a position in a particular stock or security.

    Also referred to as "Closing Transaction."

    Closing Market Rate

    The rate at which a position can be closed based on the market price at end of the day Closing price. The final price at which a security is traded on a given trading day.

    Closing Price

    The price of the last transaction for a given security at the end of a given trading session. also called close.

    Closing Purchase Transaction

    The final transaction for a particular security during a trading day. Compare opening transaction. An option order that eliminates or decreases the size of an existing option position. An investor who repurchases three options that have been sold short is entering into a closing transaction. Also called closing purchase, closing sale. Compare opening transaction. See also close a position.


    Chicago Mercantile Exchange. An exchange where financial futures, foreign currency futures, commodity futures, and futures options are traded. also called Merc.


    A line used in the capital asset pricing model to illustrate the rates of return for efficient portfolios depending on the risk-free rate of return and the level of risk (standard deviation) for a particular portfolio.
    Indicator Index">
    Coincidence Indicator Index

    An economic factor that varies directly and simultaneously with the business cycle, thus indicating the current state of the economy.

    Coincident Index - Japan

    The data reinforced the market view that the Bank of Japan is likely to sit tight on monetary policy for the rest of the year in view of a global economic slowdown and high energy costs.

    "The coincident index underscored the possibility that the economy peaked in the final quarter of last year and may have entered a recession in the economic cycle," said Junko Nishioka, economist at the Royal Bank of Scotland.

    The Cabinet Office said the economy was "deteriorating", adding that this was a provisional judgment that the economy is likely in a recession.

    Coincident Indicator

    An economic factor that varies directly and simultaneously with the business cycle, thus indicating the current state of the economy.


    An economic factor that varies directly and simultaneously with the business cycle, thus indicating the current state of the economy.


    The primary market for trading metals such as gold, silver, copper and aluminum. Formerly known as the Commodity Exchange Inc., the COMEX merged with the New York Mercantile exchange in 1994 and became the division responsible for metals trading.

    Commercial Paper

    Short-term, unsecured, discounted, and negotiable notes sold by one company to another in order to satisfy immediate cash needs.


    A service charge assessed by a broker or investment advisor in return for providing investment advice and/or handling the purchase or sale of a security. Most major, full-service brokerages derive most of their profits from charging commissions on client transactions. Commissions vary widely from brokerage to brokerage.


    A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When they are traded on an exchange, commodities must also meet specified minimum standards, also known as a basis grade.

    Commodity Futures Trading Comission

    The Commodity Futures Trading Commission (CFTC) tries to ensure the integrity of the commodity and financial futures markets. It protects the public and market users from fraud, manipulation, and abusive practices while fostering an open marketplace for trading commodity futures as well as foreign currency, US and foreign government securities, and US and foreign stock indices. CFTC develops trading policy, conducts research, evaluates filings, investigates fraud and manipulation, and prosecutes violators from offices in Chicago; New York; Kansas City, Missouri; and Washington, DC. Congress created the independent agency in 1974.

    Company Operating Profit-Australia

    The difference between a company's revenues and any related costs and expenses, not including income or expenses from any sources other than its normal methods of providing a good or a service
    Index of Leading Indicators">
    Composite Index of Leading Indicators

    The Composite Index of Leading Indicators is a number that is used by many economic participants to judge what is going to happen in the near future. By looking at the Composite Index of Leading Indicators in the light of business cycles and general economic conditions, investors and businesses can form expectations about what's ahead, and make better-informed decisions.

    Compound Option

    This type of option usually exists for currency or fixed-income markets, where an uncertainty exists regarding the option's risk protection capabilities. The advantages of compound options are that they allow for large leverage and they are cheaper than straight options. However, if both options are exercised, the total premium will be more than the premium on a single option.

    Concerted Intervention

    Simultaneous intervention in foreign exchange markets by several central banks by buying or selling a currency. Concerted intervention is usually to support one central bank which is trying to maintain a target rate for its currency or is trying to slow the rate at which it is rising or falling. The intervention may be designed to strengthen or weaken a currency as a matter of deliberate policy, or to fight off speculative currency flows.

    conference board

    A not-for-profit research organization for businesses that distributes information about management and the marketplace. It is a widely quoted private source of business intelligence.


    A confirmation strengthens the implication of technical indicators. When a confirmation occurs, traders become more confident that the predicted trend will occur. If there is no confirmation, there is divergence.

    Construction output

    This report analyses the market for electrical contracting. We estimate the output value of this market in Great Britain to have been £12.85bn in 2008 — an increase of 1.3% compared with the previous year. Electrical contracting is an important part of the construction industry and covers the installation of fixed electrical wiring and fittings for electrical power, lighting, alarms, security systems and communications equipment.

    Consumer Confidence Index

    A measure of consumer optimism toward current economic conditions. The consumer confidence index was arbitrarily set at 100 in 1985 and is adjusted monthly on the basis of a survey of about 5,000 households. The index considers consumer opinion on both current conditions (40% of the index) and future expectations (the other 60%). The Consumer Confidence Index is closely watched because many economists consider consumer optimism an important indicator of the future health of the economy.
    This content can be found on the following page.

    Consumer Credit

    Debt assumed by consumers for purposes other than home mortgages. Interest on consumer loans had been 100% deductible until the tax reform act of 1986 mandated that the deduction be phased out by 1991. Consumers can borrow through credit cards, lines of credit, loans against insurance policies, and many other methods. The Federal Reserve Board releases the amount of outstanding consumer credit on a monthly basis.

    Consumer Price Index

    CPI. An inflationary indicator that measures the change in the cost of a fixed basket of products and services, including housing, electricity, food, and transportation. The CPI is published monthly. also called cost-of-living index.

    Consumer sentiment

    The degree of optimism that consumers are expressing for the state of the economy through their saving and spending activity.

    consumer spending

    Good and services bought by households in the satisfaction of their needs and wants. It includes non-durables such as food, semi-durables such as clothing, and durables such as refrigerators.


    Disease transmission by direct or indirect contact.A disease that is or may be transmitted by direct or indirect contact; a contagious disease.The direct cause, such as a bacterium or virus, of a communicable disease.


    In general: legal agreement between two or more parties, such as that between an advertising agency and its clients, that describes the services to be performed and the price and payment terms.

    Contract Expiration Date

    The date on which a currency must be delivered to fulfill the terms of the contract.

    Contract Month

    The month during which a futures contract expires, and during which delivery may take place according to the terms of the contract. also called contract month. also called delivery month.

    convenience store

    A small retail store that is open long hours and that typically sells staple groceries, snacks, and sometimes.

    Convenience Store Sales

    A small retail store that is open long hours and that typically sells staple groceries, snacks, and sometimes gasoline.


    The degree to which the price in a futures or forward market moves toward, or converges, with prices in the cash market as the expiration date approaches. Generally, if convergence is reached at expiration, then that market is likely to be more liquid and easily traded. A trader can be fairly certain that a stock index contract closely matches the cash settlement value of the actual stocks, so it serves as a good hedge. If convergence is less definite, then the pricing relationships between the futures contract and the cash product are less defined and may pose problems for traders or arbitrageurs who want to use the financial instruments to hedge their risk.


    The exchange of a convertible type of asset into another type of asset, usually at a predetermined price, on or before a predetermined date. The conversion feature is a financial derivative instrument that is valued separately from the underlying security. Therefore, an embedded conversion feature adds to the overall value of the security.

    Convertible currency

    A currency for which there are no barriers or restrictions in the foreign exchange market.


    Slang for the Danish krone.


    A legal entity that is separate and distinct from its owners. Corporations enjoy most of the rights and responsibilities that an individual possesses; that is, a corporation has the right to enter into contracts, loan and borrow money, sue and be sued, hire employees, own assets and pay taxes.


    A reverse movement, usually negative, of at least 10% in a stock, bond, commodity or index. Corrections are generally temporary price declines, interrupting an uptrend in the market or asset.


    In the world of finance, a statistical measure of how two securities move in relation to each other. Correlations are used in advanced portfolio management.


    The name given to a bank, broker, dealer, or financial institution that acts on behalf of another financial institution with limited or restricted access to the financial markets where a transaction must occur.

    Correspondent Bank

    A correspondent account is an account (often called a nostro or vostro account) established by a domestic banking institution to receive deposits from, make payments on behalf of, or handle other financial transactions for a foreign financial institution. This allows foreign banks to conduct business and provide services to their clients without the expense of a physical presence.

    "Correspondent banking is also known as a relationship entered into between a small bank and a big bank in which the big bank provides a number of deposit, lending, and other services.

    Cost of Carry

    Costs incurred as a result of an investment position. These costs can include financial costs, such as the interest costs on bonds, interest expenses on margin accounts and interest on loans used to purchase a security, and economic costs, such as the opportunity costs associated with taking the initial position.
    Cost of Living Index

    An indicator of the current price level for goods and services related to some base year.

    Counter Currency

    In foreign exchange markets, the quote currency is the second currency in a currency pair.The quote currency is also known as the counter currency.If looking at the EUR/USD currency pair, the U.S. Dollar is the quote currency, and the Euro is the base currency. This money or currency-related article is a stub. You can help Wikipedia by expanding it.


    Counterpart International finds perfect partners to work together in improving the quality of life for communities worldwide. The not-for-profit humanitarian relief organization provides food, medical supplies, disaster relief, technical and economic assistance, and training to countries in the former Soviet Union, Central Asian republics, Southeast Asia, Eastern Europe, and Africa. It helps form coalitions of companies, governments, and grass roots organizations to build schools and hospitals, foster micro-businesses, and develop tourism in war torn or disaster affected areas. Counterpart was founded in 1965 as the Foundation for the Peoples of the South Pacific.


    The other party that participates in a financial transaction. Every transaction must have a counterparty in order for the transaction to go through. More specifically, every buyer of an asset must be paired up with a seller that is willing to sell and vice versa.

    Counterparty Risks

    The risk to each party of a contract that the counterparty will not live up to its contractual obligations.


    Countervalue refers to the targeting of an opponent's cities and civilian populations. In contrast, counterforce refers to the targeting of an opponent's military personnel, forces and facilities.

    Country Risk

    When a country defaults it can harm the performance of all other financial instruments in that country, as well as other countries.

    Coupon Value

    The rate of return anticipated on a bond if it is held until the maturity date. YTM is considered a long-term bond yield expressed as an annual rate. The calculation of YTM takes into account the current market price, par value, coupon interest rate and time to maturity. It is also assumed that all coupons are reinvested at the same rate. Sometimes this is simply referred to as "yield" for short.


    Cover is a general term used in many different instances. For instance, an investors that recently puchased a security will have to cover the puchase by depositing the necessary funds. Or, an investor may wish to cover his/her short position by purchasing the stock. Or, a portfolio manager may wish to cover his/her risk exposure by buying an offsetting position.


    CPI is seen by many as the most important measure of inflation. The Consumer Price Index measures the price level of a fixed basket of goods and services purchased at a consumer level.

    Crawling peg

    Crawling peg is an exchange rate regime usually seen as a part of fixed exchange rate regimes which allows depreciation or appreciation in an exchange rate gradually. Some central banks use a formula which triggers a change when certain conditions are met (like need for adjustment for inflation), while others prefer not to use a preset formula and change exchange rate frequently to discourage speculations.

    Credit Card

    A card allowing someone to make a purchase on borrowed money. Credit cards are one of the most popular forms of payment for consumer goods and services in the United States.

    Credit Checking

    The process of evaluating an applicant's loan request or a corporation's debt issue in order to determine the likelihood that the borrower will live up to his/her obligations. also called credit analysis.

    credit line

    An arrangement in which a bank or vendor extends a specified amount of unsecured credit to a specified borrower for a specified time period. also called line of credit.

    Credit Risk

    The possibility that a bond issuer will default, by failing to repay principal and interest in a timely manner. Bonds issued by the federal government, for the most part, are immune from default (if the government needs money it can just print more). Bonds issued by corporations are more likely to be defaulted on, since companies often go bankrupt. Municipalities occasionally default as well, although it is much less common. also called default risk.

    Cross Currency Pairs

    The quotation and pricing structure of the currencies traded in the forex market: the value of a currency is determined by its comparison to another currency. The first currency of a currency pair is called the "base currency", and the second currency is called the "quote currency". The currency pair shows how much of the quote currency is needed to purchase one unit of the base currency.

    Cross Deal

    You are going to lose money if you invest in stocks. Sooner or later, it’s bound to happen. If fact, it may have happened already and you don’t recognize it because losses can take several different forms.

    Cross Rate

    The exchange rate between two currencies that are not the official currencies of the country that the exchange was quoted in. Cross rates usually do not involve the U.S. dollar. For example, an investor in the United States could get the cross rate of the Euro to the Canadian Dollar.

    Cross rates

    Rates between two currencies, neither of which is the US Dollar.


    The currency exchange rate between two currencies


    A practice in which a broker offsets buy and sell orders without recording the transactions on the exchange. This is illegal, because it may prevent an investor from getting the best possible price on the trade.


    The point on a stock chart when a security and an indicator intersect. Crossovers are used by technical analysts to aid in forecasting the future movements in the price of a stock. In most technical analysis models, a crossover is a signal to either buy or sell.

    Cup with Handle

    The cup and handle is a unique bullish continuation pattern. It starts after a stock stages a lengthy rally. The stock then pulls back and starts to level off. The stock then rallies back up to the point at which the previous run ended. The stock reverses once more from the same level, creating horizontal resistance. The stock levels off after pulling back, attracting buyers, but this time at a relatively higher price. It returns to the horizontal resistance once more and breaks out, continuing its bullish trend.


    A generally accepted form of money, including coins and paper notes, which is issued by a government and circulated within an economy. Used as a medium of exchange for goods and services, currency is the basis for trade.

    Currency Basket

    A currency basket is commonly used in contracts as a way of avoiding (or minimizing) the risk of currency fluctuations. The European Currency Unit (which was replaced by the euro) and the Asian Currency Unit are examples of currency baskets.

    Currency Option

    A contract that grants the holder the right, but not the obligation, to buy or sell currency at a specified exchange rate during a specified period of time. For this right, a premium is paid to the broker, which will vary depending on the number of contracts purchased. Currency options are one of the best ways for corporations or individuals to hedge against adverse movements in exchange rates.

    Currency Pair

    The quotation and pricing structure of the currencies traded in the forex market: the value of a currency is determined by its comparison to another currency. The first currency of a currency pair is called the "base currency", and the second currency is called the "quote currency". The currency pair shows how much of the quote currency is needed to purchase one unit of the base currency

    Currency Risk

    A form of risk that arises from the change in price of one currency against another. Whenever investors or companies have assets or business operations across national borders, they face currency risk if their positions are not hedged.

    Currency symbols

    A currency sign is a graphic symbol often used as a shorthand for a currency's name. Internationally, ISO 4217 codes are used instead of currency signs, though currency signs may be in common use in their respective countries. Most currencies in the world have no specific symbol

    Current Account

    The difference between a nation's total exports of goods, services and transfers, and its total imports of them. Current account balance calculations exclude transactions in financial assets and liabilities.

    Current Balance

    An apparatus with which force is measured between current-carrying conductors, with the purpose of assigning the value of the ampere. Also known as ampere balance.


    Interval or unit of time specified within a contract, when the contract is for a longer time period. For example, an advertiser may have a television broadcast media purchase contract for a period of one year. Within that year contract, there may be specified four 13-week periods of television programming. Each 13-week period is considered a cycle. The advertiser may change or cancel the contract (with proper notice, of course) at the end of a cycle.
    Last edited by PCMAnalyst; 04-24-2014 at 05:14 PM.

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    Daily Trading Limit

    Maximum that many commodities and options are allowed to rise or fall in one day. When a market reaches its limit early and stays there all day, it is said to be having an up-limit or down-limit day.

    Day Order

    A day order will not be executed if the limit or stop order prices were not met during the day. A way to increase the life of an order is to order securities on a 'good 'till cancelled' basis, where, as the name implies, the trade will not expire until it is cancelled or until it reaches a maximum time limit set by the brokerage.

    Day Trader

    A day order will not be executed if the limit or stop order prices were not met during the day. A way to increase the life of an order is to order securities on a 'good 'till cancelled' basis, where, as the name implies, the trade will not expire until it is cancelled or until it reaches a maximum time limit set by the brokerage.

    Day Trading

    A stock trader who holds positions for a very short time (from minutes to hours) and makes numerous trades each day. Most trades are entered and closed out within the same day.


    The Department for Communities and Local Government[1] (CLG) is the UK Government department for communities and local government in England, since May 2006.[1] The department originated in 2001 as the Office of the Deputy

    Deal Date

    The date on which a transaction is agreed upon.

    Deal Ticket

    The primary method of recording the basic information relating to a transaction.

    Deal Ticket/Deal Slip

    The primary method of recording the basic information relating to a transaction.


    An individual or entity, such as a securities firm, when it acts as a principal and stands ready to buy and sell for its own account. More generally, an individual or entity which buys and sells products and holds an inventory.


    An amount borrowed or owed between two parties. Debt comes with the implied (or explicitly stated) promise to repay, a repayment schedule and interest arrangements on outstanding debt.

    Debt may be reflected in the form of a contract, bond, mortgage or other form stating terms of repayment, maturity date and interest arrangements An amount owed to a person or organization for funds borrowed. Debt can be represented by a loan note, bond, mortgage or other form stating repayment terms and, if applicable, interest requirements. These different forms all imply intent to pay back an amount owed by a specific date, which is set forth in the repayment terms.

    Declaration Date

    The latest day or time by which the buyer of an option must intimate to the seller his willingness or unwillingness to exercise the option.


    Failure by the bond issuer to pay the interest or principal, when due.


    A negative balance of trade or payments.


    A statistical tool that converts current dollars into inflation-adjusted dollars, in order to compare prices over time after factoring out the overall effects of inflation.


    An FX trade where both sides make and take actual delivery of the currencies traded.

    Delivery Date

    The date of maturity of the contract, when the final settlement of transaction is made by exchanging the currencies. This date is more commonly known as the value date.

    Delivery Month

    The calendar month in which a futures contract comes to maturity and becomes deliverable.

    Delivery Points

    A location or facility designated by a futures exchange for tendering and accepting goods deliverable according to the terms of a futures contract.

    Delivery Risk

    A term to describe when a counterparty will not be able to complete his side of the deal. This risk is very high in case of over the counter transactions where there is no exchange which can stand as a guarantee to the trade between the two parties to the contract.


    1.The change in price of a call option for every one-point move in the price of the underlying security. also called hedge ratio.

    2.The ratio of the change in price of an option to the change in price of the underlying asset. Also called the hedge ratio. Applies to derivative products. For a call option on a stock, a delta of 0.50 means that for every $1.00 that the stock goes up, the option price rises by $0.50. As options near expiration, in-the-money call option contracts approach a delta of 1.0, while in-the-money put options approach a delta of -1. See: hedge ratio, neutral hedge. Call deltas range from 0.00 to +1.00; put deltas range from 0.00 to -1.00. If the call delta is 0.69, the put delta is -0.31 (call delta minus 1 equals put delta; 0.69 -1 =-0.31).

    Department for Communities and Local Government

    Department for Communities and Local Government (UK Government department, successor to ODPM)


    The initial outlay required of a client by a futures position to open a futures position, returnable upon liquidation of that position.

    Depository Institution

    A depository institution is a financial institution in United States, such as a savings bank, that is legally allowed to accept monetary deposits from consumers. Federal depository institutions are regulated by the Federal Deposit Insurance Corporation (FDIC). An example of a non-depository institution might be a mortgage bank. While licensed to lend, they cannot accept deposits.


    A fall in the value of a currency due to market forces.


    A contract that changes in value in relation to the price movements of a related or underlying security, future or other physical instrument. An Option is the most common derivative instrument.


    A broad term relating to risk management instruments such as futures, options, swaps, etc.. The contract value moves in relation to the underlying instrument or currency.


    Term referring to a group dealing with a specific currency or currencies.


    All the information required to finalize a foreign exchange transaction, i.e. name, rate, dates, and point of delivery.


    The act by a government to reduce the external value of its currency.


    Department of Employment and Workplace Relations (Australia)

    DEWR Skilled Vacancies - Australia

    Measures the monthly change in skilled job vacancies across Australia . Expressed as an index, the Skilled Vacancies Index is a leading indicator for the Australian Labor market. A high number of vacancies indicate a job market where labor is in demand and employers are pressured to increase wages. Rising wages put upward pressure on inflation than can lead to interest rate changes. On the other hand fewer skilled vacancies imply a tighter job market where skilled workers face greater difficulty finding employment, possibly weighing wages down.


    Dublin Inter-bank Offered Rate.

    Direct Quote

    Representation of cost of unit of a foreign currency in terms of national currency.

    Dirty Float

    An exchange rate system in which the currency is not pegged, but is "managed" by the central bank to prevent extreme fluctuations in the exchange rate. The exchange rate is managed through changes in the interest rate to attract/detract capital flows or through the buying and selling of the currency. This system is contrasted with a Pure Float in which there is no central bank intervention and the exchange rate is entirely determined by the market and speculation. Also known as "Managed Float."


    Less than the spot price example: forward discount.

    Discount House

    An institution that purchases promisory notes and resells them or holds them until maturity.

    Discount Rate

    The rate at which member banks may borrow short term funds directly from a Federal Reserve Bank. The discount rate is one of the two interest rates set by the Fed, the other being the Federal funds rate. The Fed actually controls this rate directly, but this fact does not really help in policy implementation, since banks can also find such funds elsewhere. also called Federal Reserve Discount Rate.

    Discretionary Account

    An account in which the customer permits a trading institution to act on the customer's behalf in buying and selling currency pairs. The institution has discretion as to the choice of currency pairs, prices, and timing-subject to any limitations specified in the agreement.

    Distributive Trade

    Distribution of material goods to consumers, through retailing and wholesaling


    That part of the earnings of a corporation that is distributed to its shareholders; usually paid quarterly

    Index- Japan">
    Domestic CGPI -Domestic Corporate Goods Price Index- Japan

    The Domestic Corporate Goods Price Index measures prices for goods purchased by Japanese corporations. As prices for input materials and the overall cost of manufacturing change, companies adjust retail prices accordingly. The CGPI comprehensively tracks these supply-side price pressures and increases in the index often precede upward movement in the CPI. If an increase in the CGPI is followed by a rise in the CPI, concerns about inflation may prompt the Bank of Japan to raise interest rates. The headline numbers are the percentage change in the index month or month and annually.

    Note : The index's base year is the year 2000 and the base value is 100. Thus, an index value of 105 signifies a 5% increase in prices since the year 2000. The data report also contains individual indexes for each commodity category used in the Wholesale Price Index.

    Domestic corporate Goods Price Index_Domestic CGPI - Japan

    The Domestic Corporate Goods Price Index measures prices for goods purchased by Japanese corporations. As prices for input materials and the overall cost of manufacturing change, companies adjust retail prices accordingly. The CGPI comprehensively tracks these supply-side price pressures and increases in the index often precede upward movement in the CPI. If an increase in the CGPI is followed by a rise in the CPI, concerns about inflation may prompt the Bank of Japan to raise interest rates. The headline numbers are the percentage change in the index month or month and annually.

    Domestic Demand

    Measure of the amount of goods and services sought by German consumers. This sort of consumption is the largest component of GDP and key to German economic growth. Given that Germany is the largest country in the Euro-zone; its economic activity will be reflected in Euro-zone figures and watched by the European Central Bank. Though Germany is traditionally an export driven economy, the strength of domestic demand can determine whether economic slowdown or growth is in the future.


    An option either to buy or sell an instrument or currency at a specified price. The exercise of the right to sell causes the right to buy to expire and vice versa.

    Durable Goods Order

    An economic indicator which measures the changes in sales of products with a life span in excess of three years.

    Dwelling Starts - Australia

    The number of construction starts on new homes in the past month. The figure, officially called Construction of Dwellings, measures growth in the construction sector and reflects the overall health of the housing market. Increased spending on expensive items like new homes reflects consumer optimism towards the economy. The headline number is the percentage change in Dwelling Starts from the previous month's figure.
    Last edited by PCMAnalyst; 04-25-2014 at 02:36 PM.

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    Modest decline in price.

    ECB--European Central Bank

    The Central Bank for the new European Monetary Union.

    Echo Watchers Survey

    The Economy Watchers Survey asks business-cycle sensitive workers their thoughts on existing and future economic conditions, giving a detailed picture of economic trends in Japan . The survey is based on questionnaires from 'man on the street' sectors that are particularly vulnerable to business cycle turns. These segments of the economy include sectors such as retail, restaurant service, and taxi driving. With this combined data the Japanese Eco Watchers report serves as both a consumer confidence indicator and a leading indicator for the rest of the economy. The report is usually released less than two weeks after the reporting month, thus its statistics are usually very timely. The headline number is released where 50 represents the center midpoint line of boom/bust sentiment.

    Economic Exposure

    The risk on a company's cash flow arising from foreign exchange fluctuations

    Economic and Monetary Union - EMU

    An economic and monetary union is a single market with a common currency. It is to be distinguished from a mere currency union (e.g. the Latin Monetary Union in the 1800s), which does not involve a single market.

    The largest economic and monetary union at present is the Eurozone. The Eurozone consists of the European Union member states that have completed the third stage of the EMU by adopting the Euro. Some non-EU members have also adopted the Euro, but they are not part of this EMU

    Economic Exposure

    Reflects the impact of foreign exchange changes on the future competitive position of a company in the sense of the impact it can have on the future cash flows of the company. An exposure to fluctuating exchange rates, which affects a company's earnings, cash flow and foreign investments. The extent to which a company is affected by economic exposure depends on the specific characteristics of the company and its industry.

    Economic Indicator

    A government issued statistic that indicates current economic growth and stability. Common indicators include employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.

    Economy - Overheated

    Is an economy on a high growth rate trajectory placing pressure on the production capacity resulting in increased inflationary pressures and higher interest rates.

    ECP-Eurocommercial Paper

    An unsecured, short-term loan issued by a bank or corporation in the international money market, denominated in a currency that differs from the corporation's domestic currency.

    For example, if a U.S. corporation issues a short-term bond denominated in Canadian dollars to finance its inventory through the international money market, it has issued eurocommercial paper.


    European Currency Unit.
    ECU. A composite monetary unit consisting of a basket of European Community currencies that served as the predecessor to the Euro.

    ECU - European Currency Unit

    A basket of the member currencies. As a composite unit, the ECU consists of all the European Community currencies, which are individually weighted. It was created by the European Monetary System with the eventual goal of replacing the individual European member currencies.


    Electronic Data Interchange.
    (Electronic Data Interchange) The electronic communication of business transactions, such as orders, confirmations and invoices, between organizations. Third parties provide EDI services that enable organizations with different equipment to connect. Although interactive access may be a part of it, EDI implies direct computer-to-computer transactions into vendors' databases and ordering systems.

    Efficient Market Theory

    The theory that the current market price reflects all information and expectations regarding the currency pair in question. The theory also assumes that the market cannot overprice or underprice an asset, and hence the current price is the correct valuation at the time.

    Efficient Markets

    Markets where assets are traded in which the price is indicative of all current and relevant information and thus it is impossible to have undervalued assets.


    Electronic Fund Transfer.
    Electronic funds transfer or EFT refers to the computer-based systems used to perform financial transactions electronically.

    EIA Natual Gas Report

    The Energy Information Administration (EIA) provides weekly information on natural gas stocks in underground storage for the U.S., and three regions of the country. The level of inventories help determine prices for natural gas products.

    EIA-Energy Information Administration

    Energy Information Administration
    The Energy Information Administration (EIA), as part of the U.S. Department of Energy, collects and disseminates data on energy reserves, production, consumption, distribution, prices, technology, and related international, economic, and financial matters. Coverage of EIA's programs includes data on coal, petroleum, natural gas, electric, and nuclear energy.

    Elliot Wave Theory

    A theory based on the notion that the market moves in waves, which consist of trends followed by partial corrections. The Elliot Wave Theory states that there are 5 waves within an overall trend.

    Empire State Manufacturing Survey - United States

    The New York Fed conducts this monthly survey of manufacturers in New York State. Participants from across the state represent a variety of industries. On the first of each month, the same pool of roughly 175 manufacturing executives (usually the CEO or the president) is sent a questionnaire to report the change in an assortment of indicators from the previous month. Respondents also give their views about the likely direction of these same indicators six months ahead. This index is seasonally adjusted using the Philadelphia Fed's seasonal factors because its own history is not long enough with data only going back a couple of years. (Federal Reserve Bank of New York)

    employment cost index

    A closely watched economic report by the Bureau of Labor Statistics that indicates the total cost of employing a civilian worker. A larger-than-expected increase in the index is likely to place downward pressure on both bond and equity prices.

    Employment Level - Switzerland

    The number of paid employees working at least six hours each week. The headline number for the employment level, which is officially known as "workforce jobs," appears as both the total number of employees and as a year on year percentage change in that figure. The Swiss employment level is important serving as the headline figure for job growth or decline. Higher job growth accompanies economic expansion and could spark inflationary pressures. Swiss unemployment has historically been very low, averaging half that of the EU. Whereas most countries consider an unemployment rate of 4% very low, Switzerland is accustomed to rates below 4%. Relevance : Rarely affects markets


    European Monetary System

    A system designed to stabilize if not eliminate exchange risk between member states of the EMS as part of the economic convergence policy of the EU. It permits currencies to move in a measured fashion (divergence indicator) within agreed bands (the parity grid) with respect to the ECU and consequently with each other.


    European Monetary Union

    EMU (Economic and Monetary Union)

    Economic and Monetary Union

    End Of Day Order - EOD

    An order to buy or sell at a specified price. This order remains open until the end of the trading day which is typically 5PM ET.


    A term used for international trade where goods are shipped to a centre for re-export. Hong Kong engages in significant amounts of this form of trade.


    While Bollinger Bands place boundary lines based on standard deviation, envelopes place lines at fixed percentage points above and below a moving average line. The upper and lower limits specify entry and exit points for currency traders.

    EOD - End Of Day Order

    An order to buy or sell at a specified price. This order remains open until the end of the trading day which is typically 5PM ET.


    European Options Exchange.


    A price region that suggests a balance between demand and supply for an currency pair in the marketplace.

    Equipment Investment - Germany - Euro-zone

    Measures the total value of German investments in equipment including machinery and construction equipment. Equipment Investment is a part of GDP and released at the same time, therefore changes in the figure directly change overall GDP. But Equipment Investment is also an early indicator for production since companies generally make capital expenditures in a healthy economy when the need to expand operational productivity exists. Because such capital expenditures are sensitive to business conditions, the report can also forecast economic growth or recession. The headline number is the percentage change in Equipment Investment in the reporting quarter.

    equity market

    The market in which shares are issued and traded, either through exchanges or over-the-counter markets. Also known as the stock market, it is one of the most vital areas of a market economy because it gives companies access to capital and investors a slice of ownership in a company with the potential to realize gains based on its future performance.

    This market can be split into two main sectors: the primary and secondary market. The primary market is where new issues are first offered. Any subsequent trading takes place in the secondary market.


    Exchange Rate Mechanism.


    The common currency adopted by eleven European nations(Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal) on January 1, 1999.


    A long-term loan issued in a currency other than that of the country or market in which it is issued. Interest is paid without the deduction of tax.


    One of the leading clearing systems for eurobonds.


    US currency or funds held in banks outside the US—in Europe or anywhere else. Eurodollars are used commonly for settling international transactions.

    European Monetary Union

    An institution of the EU, whose primary goal is to establish a single currency (the euro) for the entire EU.

    European Monetary Union - EMU

    The principal goal of the EMU is to establish a single European currency called the Euro, which will officially replace the national currencies of the member EU countries in 2002. On Janaury1, 1999 the transitional phase to introduce the Euro began. The Euro now exists as a banking currency and paper financial transactions and foreign exchange are made in Euros. This transition period will last for three years, at which time Euro notes an coins will enter circulation. On July 1,2002, only Euros will be legal tender for EMU participants, the national currencies of the member countries will cease to exist. The current members of the EMU are Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal.

    European Union

    The group formerly known as the European Community.

    Exchange Rate Risk

    The risk that a business' operations or an investment's value will be affected by changes in exchange rates. For example, if money must be converted into a different currency to make a certain investment, changes in the value of the currency relative to the American dollar will affect the total loss or gain on the investment when the money is converted back. This risk usually affects businesses, but it can also affect individual investors who make international investments.

    Exchange control

    Rules used to preserve or protect the value of a country's currency.

    Exchange Rate Risk

    The potential loss that could be incurred from an adverse movement in exchange rates.


    The Process of completing an order or deal.


    When an option or warrant holder takes up his or her option to buy or sell the underlying instrument (for example shares, commodities, an index etc) he/she is said to exercise the option or warrant.

    Exercise (options)

    The owner of an option contract may exercise it, indicating that the financial transaction specified by the contract is to be enacted immediately between the two parties, and the contract itself is terminated. When exercising a call, the owner of the option purchases the underlier at the strike price from the option seller, while for a put, the owner of the option sells the underlier to the option seller.

    Exercise Notice

    A formal notification that the holder of an option wishes to exercise it by buying or selling the underlying stock at the exercise price.

    Exercise Price - Strike Price

    The price at which an option can be exercised.


    A foreign exchange term for a thinly traded currency. Exotic currencies are illiquid, lack market depth and trade at low volumes. Trading an exotic currency can be expensive, as the bid-ask spread is usually large.

    Exotics are not considered major currencies because they are not easily traded in a standard brokerage account. Major currencies include the U.S. dollar, eurodollar, Canadian dollar and Swiss franc. Examples of exotic currencies include the Thai baht, Uruguay peso or Iraqi dinari.


    Growth, as in an economic recovery.

    Expiration Date

    (1) Options - the last date after which the option can no longer be exercised. (2) Bonds-the date on which a bond matures.

    Expiration Month

    The month in which an option expires.

    Expiry Date

    The last day on which the holder of an option can exercise his right to buy or sell the underlying security.

    Exponentially Weighted Moving Average - EMA

    While the simple moving average distributes weight equally across the data series, exponentially weighted moving averages place greater weight to more recent data. As a result, they tend to provide a faster signal.


    In foreign exchange, a potential for gain or loss because of movement in foreign exchange rate.
    Last edited by PCMAnalyst; 04-26-2014 at 10:01 AM.

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    face value

    The value printed on the face of a stock, bond, or other financial instrument or document.

    Factory Orders

    An economic indicator which refers to the total orders of durable and nondurable goods. The nondurable goods orders consist of food , clothing , light industrial products and products designed for the maintenance of the durable goods.

    Fast Market

    A financial market experiencing high trading volume and increased volatility.

    FDIC=Federal Deposit Insurance Corporation

    The Federal Deposit Insurance Corporation (FDIC) is a United States government corporation created by the Glass-Steagall Act of 1933. The vast number of bank failures in the Great Depression spurred the United States Congress into creating an institution which would guarantee deposits held by commercial banks, inspired by the Commonwealth of Massachusetts and its Depositors Insurance Fund (DIF). The FDIC provides deposit insurance which currently guarantees checking and savings deposits in member banks up to $100,000 per depositor.

    Fed - Federal Reserve

    The Central Bank of the United States.

    Fed Fund Rate

    The interest rate on Fed funds. This is a closely watched short term interest rate as it signals the Feds view as to the state of the money supply.

    Fed Funds

    Reserve balances that are maintained by commercial banks in the Federal Reserve System at amounts above what is required. These excess reserves are available for lending to other banks in need of reserves. Although the loans are usually made on a single-day basis, they may be renewed. The availability of and the rate paid for federal funds are important indicators of Federal Reserve policy; hence, both are watched closely by financial analysts in order to forecast changes in the credit markets. Also called fed funds.


    Foreign Exchange Dealers Association of India) is an association of all dealers in foreign exchange which sets the ground rules for fixation of commissions and other charges and also determines the rules and regulation relating to day-to-day transactions in foreign exchange in India. The FEDAI has commonly recognised 38 currencies for dealing.

    Federal Deposit Insurance Corporation - FDIC

    The Federal Deposit Insurance Corporation (FDIC) is a United States government corporation created by the Glass-Steagall Act of 1933. The vast number of bank failures in the Great Depression spurred the United States Congress into creating an institution which would guarantee deposits held by commercial banks, inspired by the Commonwealth of Massachusetts and its Depositors Insurance Fund (DIF). The FDIC provides deposit insurance which currently guarantees checking and savings deposits in member banks up to $100,000 per depositor.

    Federal National Mortgage Association-Fannie Mae

    The Federal National Mortgage Association (FNMA) (NYSE: FNM), commonly known as Fannie Mae, is a government sponsored enterprise (GSE) sponsored by the United States government. As a GSE, it is a privately-owned corporation authorized to make loans and loan guarantees. It is not backed or funded by the U.S. government, nor do the securities it issues benefit from any explicit government guarantee or protection. This secondary mortgage market helps to replenish the supply of lendable money for mortgages and ensures that money continues to be available for new home purchases. The name "Fannie Mae" is a creative acronym-portmanteau of the company's full name that has been adopted officially for ease of identification.

    Federal Open Market Committee

    Abbreviation for Federal Open Market Committee. 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 purchasing and selling government securities which affects the federal funds rate).

    Federal Open Market Committee=FOMC

    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 purchasing and selling government securities which affects the federal funds rate).

    Federal Reserve - Fed

    The Central Bank of the United States.

    Federal Reserve Board

    The board of the Federal Reserve System, appointed by the US President for 14 year terms, one of whom is appointed for four years as chairman.

    Federal Reserve System

    The central banking system of the US comprising 12 Federal Reserve Banks controlling 12 districts under the Federal Reserve Board. Membership of the Fed is compulsory for banks chartered by the Comptroller of Currency and optional for state chartered banks.


    An automated communications and settlement system linking the Federal Reserve banks with other banks and with depository institutions.


    The process of completing a customer's order to buy or sell a currency pair.
    Execute an order or buy or sell a security or commodity.

    Fill or Kill

    An order given to a broker that must immediately be filled in its entirety or, if this is not possible, totally canceled.

    Fill Price

    The price at which a buy or sell order was executed.

    Final Goods

    In economics final goods are goods that are ultimately consumed rather than used in the production of another good. For example, a car sold to a consumer is a final good; the components such as tires sold to the car manufacturer are not; they are intermediate goods used to make the final good.


    To raise money through the issuance and sale of debt and/or equity.

    Financial Asset

    A non-physical asset, such as a security, certificate, or bank balance

    Financial Risk

    The possibility that a bond issuer will default, by failing to repay principal and interest in a timely manner. Bonds issued by the federal government, for the most part, are immune from default (if the government needs money it can just print more). Bonds issued by corporations are more likely to be defaulted on, since companies often go bankrupt. Municipalities occasionally default as well, although it is much less common. also called default risk or credit risk.

    Finantial Institution

    Institution which collects funds from the public and places them in financial assets, such as deposits, loans, and bonds, rather than tangible property.


    A futures and options exchange for the trading of financial contracts on currencies and U.S. Treasury securities. The FINEX, with trading floors in New York City and Dublin, Ireland, is a division of the New York Board of Trade.

    Fiscal Policy

    Decisions by the President and Congress, usually relating to taxation and government spending, with the goals of full employment, price stability, and economic growth. By changing tax laws, the government can effectively modify the amount of disposable income available to its taxpayers. For example, if taxes were to increase, consumers would have less disposable income and in turn would have less money to spend on goods and services. This difference in disposable income would go to the government instead of going to consumers, who would pass the money onto companies. Or, the government could choose to increase government spending by directly purchasing goods and services from private companies. This would increase the flow of money through the economy and would eventually increase the disposable income available to consumers. Unfortunately, this process takes time, as the money needs to wind its way through the economy, creating a significant lag between the implementation of fiscal policy and its effect on the economy.

    Fisher Effect

    The direct relationship between inflation and interest rates. Increasing inflationary expectations result in increasing interest rates.

    Fixed Interest Security

    A fixed interest security is a debt security. When you buy or subscribe for a fixed interest security, you are in effect lending money to an entity, known as the ‘issuer’. In return for the loan you provide, the issuer will pay you a specified rate of interest (a coupon) during the lifetime of the fixed interest security, and will repay the face value of the fixed interest security (the principal) to you at a predefined time (maturity date).

    Fixed Exchange Rate

    Official rate set by monetary authorities for one or more currencies. In practice, even fixed exchange rates are allowed to fluctuate between definite upper and lower bands, leading to intervention by the central bank.


    Dealer jargon used to describe a position that has been completely reversed, e.g. you bought $500,000 then sold $500,000, thereby creating a neutral (flat) position.

    Floating Exchange Rate

    When the value of a currency is decided by the market forces dictating the demand and supply of that particular currency.


    The place on an exchange where trading occurs.


    Abbreviation for Federal Open Market Committee. 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 purchasing and selling government securities which affects the federal funds rate).

    FOMC Meeting Announcement

    The Federal Open Market Committee consists of the seven Governors of the Federal Reserve Board and five Federal Reserve Bank presidents. The FOMC meets eight times a year in order to determine the near-term direction of monetary policy. Changes in monetary policy are now announced immediately after FOMC meetings.


    To deprive (a mortgagor) of the right to redeem mortgaged property, as when payments have not been made.


    Legal process by which a lender cancels (forecloses) a borrower's right of redemption of the mortgaged property through a court order (called foreclosure order). The court sets a date up to which the borrower can redeem the property by paying off the entire loan balance (including foreclosing expenses). Thereafter, the lender is free to sell the property and, upon the sale, applies the sale proceeds first to the due amount and pays the remainder (if any) to the borrower. The borrower remains liable for the due amount if the property remains unsold, and for the shortfall if the sale proceeds are insufficient to pay off the entire debt. The lender is generally under an obligation to sell the property at or near its fair market value (FMV).

    Foreign Currency Effect

    Refers to how changes in the exchange rate affect the return on foreign investment

    Foreign direct investment - FDI

    Foreign direct investment (FDI) is defined as "investment made to acquire lasting interest in enterprises operating outside of the economy of the investor

    Foreign Exchange

    (FX) - the simultaneous buying of one currency and selling of another.

    Foreign Exchange Centers

    London is the largest centre of foreign exchange trading. New York, Tokyo, Singapore, Zurich and Hong Kong are also important.

    Foreign Exchange Market

    Market where currencies are traded internationally. About a trillion (million million) dollars-worth of foreign exchange is traded globally every day, making forex larger than all bond markets put together. Currency markets exist in the form of spot, forward, futures and options markets. Foreign exchange transactions are made up of: Trade flows Only 5% to 10% of total forex transactions. Imports usually need to be paid for in the currency of the country from which they originate. Exports are usually paid for in one's own currency. A trade deficit therefore causes a currency to depreciate. Flow-ons Created when a large trade is split up into several smaller trades. Capital flows Cross-border investment. Speculation Short-term investment based on expected currency movements. This accounts for the lion's share of forex market volume.

    Foreign Position

    It means a position under which one party hereto agrees to purchase from or sell to the other party hereto an agreed amount of foreign currency.


    A contract obligating one party to buy and another other party to sell a financial instrument, equity, commodity or currency at a specific future date.

    Forward Contract

    A contract between two counterparties where one person agrees to buy from the other person, who of course agrees to sell, a certain quantity of a financial instrument or commodity at a pre determined price but for delivery at an agreed future date.

    Forward Cover Taking

    forward contracts to protect against movements in the exchange rate.

    Forward Deal

    A deal with a value date greater than the spot value date.

    A transaction consisting of a purchase or sale (often of foreign currency) with settlement to occur at a specified future date. Such a transaction will state the specific amount of the asset to be delivered at the specific time, as well as the unit price at which it will be delivered.

    Forward margins

    Discounts or premiums between spot rate and the forward rate for a currency. Normally quoted in points.

    Forward Operations

    Forex transactions, on which the fulfillment of the mutual delivery obligations is made on a date later than the second business day after the transaction was concluded.

    Forward Outright

    A commitment to buy or sell a currency for delivery on a specified future date or period. The price is quoted as the Spot rate minus or plus the forward points for the chosen period.

    Forward Points

    The points that are added to or subtracted from the spot rate to calculate the forward rates for a forward foreign exchange transaction. These points are based on the differential between the interest rates of the two currency pairs.

    Forward Price

    The net price resulting from calculating the forward points and subtracting them from the existing spot rate. This is the rate at which a currency can be purchased or sold for delivery in the future.

    Forward Rate

    The rate at which a foreign exchange contract is struck today for settlement at a specified future date which is decided at the time of entering into the contract. The decision to subtract or add points is determined by the differential between the deposit rates for both currencies concerned in the transaction. The base currency with the higher interest rate is said to be at a discount to the lower interest rate quoted currency in the forward market. Therefor the forward points are subtracted from the spot rate. Similarly, the lower interest rate base currency is said to be at a premium, and the forward points are added to the spot rate to obtain the forward rate.

    Forward Rates

    The net price resulting from calculating the forward points and subtracting them from the existing spot rate. This is the rate at which a currency can be purchased or sold for delivery in the future.

    Free Reserves

    Funds available to banks for lending or investment, widely regarded as an indicator of available Bank Credit. Excess reserves are the amount remaining after required reserves are subtracted from reserve balances deposited with a Federal Reserve Bank. The total of free reserves is computed by subtracting from a bank's Excess Reserves (or reserve account balances above its reserve requirements) any borrowings from the Federal Reserve.

    Front Office

    1.In Business, front office refers to Sales and Marketing divisions of a company. It may also refer to other divisions in a company that involves interactions with customers.

    2.The activities carried out by the dealer , normal trading activities.

    Fundamental Analysis

    Analysis of economic and political information with the objective of determining future movements in a financial market.


    The macro economic factors that are accepted as forming the foundation for the relative value of a currency, these include inflation, growth, trade balance, government deficit, and interest rates.


    A way of trading financial instruments, currencies or commodities for a specific price on a specific date in the future. Unlike options, futures give the obligation (not the option) to buy or sell instruments at a later date. They can be used to both protect and to speculate against the future value of the underlying product.

    A contract to buy or sell a specified amount of a commodity or financial instrument at an agreed price at a set date in the future. If the price for the commodity or financial instrument rises between the contract date and the future date, the investor will make money; if it declines, the investor will lose money. The term also refers to the market for such contracts.

    The primary difference between a Future and a Forward is that Futures are typically traded over an exchange (Exchange- Traded Contacts - ETC), versus forwards, which are considered Over The Counter (OTC) contracts. An OTC is any contract NOT traded on an exchange.

    Futures Exchange-Traded Contracts

    They are firm agreements to deliver (or take delivery of) a standardized amount of something on a certain date at a predetermined price. Futures exist in currencies, money market deposits, bonds, shares and commodities. They are traded on an exchange with the clearing corporation gauranteeing the contract and moreover the trade is done on a mark to market basis.


    Foreign Exchange.


    Fiscal Year
    Last edited by PCMAnalyst; 04-29-2014 at 10:14 AM.

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    Eleven industrialized nations that meet on an annual basis to consult each other, debate and cooperate on international financial matters. The member countries are: France, Germany, Belgium, Italy, Japan, the Netherlands, Sweden, the United Kingdom, the United States and Canada, with Switzerland playing a minor role.


    The Group of Five. The five leading industrial countries, being US, Germany, Japan, France, UK.


    The seven leading industrial countries, being US , Germany, Japan, France, UK, Canada, Italy.


    The rate at which a delta changes over time or for one unit change in the price of the underlying asset.


    A mismatch between maturities and cash flows in a bank or individual dealers position book. Gap exposure is effectively interest rate exposure.

    GCC=Gulf Cooperation Council

    GCC is an association of Persian Gulf nations formed for the purpose of collective defense against aggression.

    The Gulf Cooperation Council, or GCC, is made up of Saudi Arabia, United Arab Emirates, Kuwait, Qatar, Oman and Bahrain.

    GDP=Gross Domestic Product

    Measures the value of goods and services produced with in a country . GDP is the most comprehensive overall measure of economic output and provides key insight as to the driving forces of the economy.

    German ZEW Indicator of Economic Sentiment

    Experts are asked for a qualitative assessment of the direction of inflation, interest rates, exchange rates and the stock market in the next six months. Thus the indicator provides a medium-term forecast for the German economy.

    Gilt-edged Securities

    Stocks and shares issued and guaranteed by the British government to raise funds and traded on the Stock Exchange. A relatively risk-free investment, gilts bear fixed interest and are usually redeemable on a specified date. The term is now used generally to describe securities of the highest value.
    According to the redemption date, gilts are described as short (up to five years), medium, or long (15 years or more).


    Risk-free bonds issued by the British government. They are the equivalent of U.S. Treasury securities.


    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.

    GNP Deflator

    Removes inflation from the GNP figure. Usually expressed as a percentage and based on an index figure.

    GNP Gap

    The difference between the actual real GNP and the potential real GNP. If the gap is negative an economy is overheated.

    Going Long

    The purchase of a stock, commodity, or currency for investment or speculation.

    Going Short

    The selling of a currency or instrument not owned by the seller.

    Gold Standard

    The original system for supporting the value of currency issued. This system was in vogue before 1973 when the fixed exchange rates were prevalent.

    Gold Tranche

    Part of the country quota for IMF members that had to be paid in gold. This was normally 25% of the quota, the remainder being in domestic currency. The Gold Tranche was automatically available to members without condition. Amount of gold that each member country of the International Monetary fund (IMF) contributes as part of its membership obligations to the fund, and can readily borrow when facing economic difficulties.

    Golden Cross

    An intersection of two consecutive moving averages which move in the same direction and suggest that the currency will move in the same direction.

    Good Till Cancelled Order - GTC

    A buy or sell order which remains open until it is filled or canceled.

    Government Expenditures - Euro-zone

    The value of spending by Euro-zone governments. Euro-zone Government Expenditures is a major component of Euro-zone GDP. However, its release has relatively little market impact since the fiscal policy of Euro-zone governments is usually well-anticipated in advance. Nevertheless, any unexpected change in government expenditures due to unforeseen events can affect to markets

    Government Spending

    Represents public expenditure by the German government. The government budget on spending is determined by fiscal policy. Thus, it is very predictable and rarely, if ever, moves the market upon release.


    The seller of an option contract

    Greenery Day

    Greenery Day (April 29): day for commemorating the Emperor Showa's love for nature and many trees he planted on tours throughout the country. (Up to 1988, this day was celebrated as the birthday of the Emperor Showa.)

    Gross Domestic Product

    Measures the value of goods and services produced with in a country . GDP is the most comprehensive overall measure of economic output and provides key insight as to the driving forces of the economy.

    Gross Fixed Capital Formation (GFCF) - Euro-zone

    A measure of European investment in capital goods. Fixed capital investments typically increase productivity and GDP growth. When businesses are investing in the big fixed capital items, such as machinery, vehicles, and buildings, it typically reflects optimism for future growth; otherwise, those businesses would other uses for that money. Higher capital investments also tend to increase productivity and contribute to GDP growth. This makes GFCF a measure of business sentiment as well as a leading indicator for economic growth. The headline figure of GFCF is expressed in annualized percentage change for the quarter. Note: GFCF makes up about 20% of the Euro-zone GDP, with Machinery, equipment, vehicles, land-improvements, and buildings being the biggest contributors. Software and artwork are sometimes considered as the intangible fixed assets.

    Gross National Product

    Gross domestic product plus income earned from investment or work abroad.

    GTC - Good 'Til Cancelled Order

    An order to buy or sell at a specified price. This order remains open until filled or until the client cancels.
    Last edited by PCMAnalyst; 04-29-2014 at 11:52 AM.

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    Hard Currency

    A currency, usually from a highly industrialized country, that is widely accepted around the world as a form of payment for goods and services. A hard currency is expected to remain relatively stable through a short period of time, and to be highly liquid in the forex market.


    Halifax Bank of Scotland


    A transaction that reduces the risk on an existing investment position.

    Hedge Fund

    A mutual fund organized as a limited partnership and using high-risk, speculative methods to obtain large profits.

    An investment company that uses high-risk techniques, such as borrowing money and selling short, in an effort to make extraordinary capital gains.

    Hedge Ratio

    The number of futures or options required to hedge a given exposure in the cash market.

    Hedged position

    One open buy position and one open sell position in the same currency.


    A hedging transaction is one whose main aim is to protect an asset or liability against a fluctuation in the foreign exchange rate rather than profit from the exchange rate fluctuations.

    Help Wanted Index

    The help wanted index is a monthly index of the number of lines of help-wanted advertising in 51 major newspapers from around the country. This index indicates strength or weakness in the labor market.


    Housing Industry Association


    Harmonized Index of Consumer Prices
    An inflation indicator used by the European Central Bank.
    The overall Consumer Price Index data for the twelve European Union member countries is referred to as the Harmonized Price Index (HICP)

    high or low- Spike

    A significantly lower low or higher high within a data series. Points where an currency spikes often signify a potential reversal in the direction of the trend, and hence can be valuable tools in analyzing a chart.


    Refers to the daily traded high and low prices of a given currency pair.

    Hit the bid

    Acceptance of purchasing at the offer or selling at the bid.

    Household Consumption - Euro-zone

    Euro-zone Household Consumption reports the mean expenditure on individual consumption goods and services per household per year. The figure is reported in the annualized percent change. Increases in Household Consumption are suggestive of increases in economic growth and of higher levels of consumer optimism, both positive indicators for the economy. However, unrestrained growth can result in inflationary pressures. Thus this report can be used as a leading indicator for inflationary pressures.

    Housing Equity Withdrawal-HEW

    Housing equity withdrawal (HEW) is new borrowing secured on dwellings that is not invested in the housing market (e.g. not used for house purchase or home improvements), so it represents additional funds available for reinvestment or to finance consumption spending.

    Housing Starts

    The number of residential building construction projects begun during a specific period of time, usually a month; a key economic indicator.


    House Price Index


    A period of rapid inflation that leaves a country's currency virtually worthless.
    Last edited by PCMAnalyst; 05-01-2014 at 10:38 AM.

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    IBD/TIPP Economic Optimism Index

    The IBD/TIPP Economic Optimism Index is the earliest and most authoritative take on consumer confidence each month and predicts with 90% reliability monthly changes in sentiment in well-known polls by The Conference Board and the University of Michigan. The IBD/TIPP Economic Optimism Index is based on a survey of 1,000-plus adults chosen at random nationwide. The poll is generally conducted in the first week of the month and has a margin of error of plus or minus 3.1 percentage points. The TIPP Economic Optimism Index is based upon responses to three questions: (1) In the next 6 months, do you think that economic conditions in the country will be better, worse or about the same as compared to now? (2) In the next 6 months, do you think that your personal financial situation will be better, worse or about the same as compared to now? (3) How satisfied are you with the current federal economic policies meant to keep the economy going in the right direction: Very satisfied, somewhat satisfied, not very satisfied or not at all satisfied?

    ICCH=International Commodities Clearing House Limited

    A clearing house based in London operating world wide for many futures markets.


    International Council of Shopping Centers

    ICSC-UBS Store Sales

    This weekly measure of comparable store sales at major retail chains, published by the International Council of Shopping Centers, is related to the general merchandise portion of retail sales. It accounts for roughly 10 percent of total retail sales. The ICSC-UBS index is one of the most timely indicators of consumer spending, since it is reported every week. It gets extra attention around the holiday season when retailers make most of their profits. It is also a useful indicator when special factors can cause economic activity to momentarily slide. For instance, it was widely watched in the aftermath of Hurricanes Katrina and Rita which hit New Orleans and the Gulf Coast in 2005.


    International Energy Agency


    International Foreign Exchange Master Agreement.


    Institut für Wirtschaftsforschung An der Universität München (German: Institute for Economic Research at the University of Munich)


    International Labor Organization


    International Monetary Fund, established in 1946 to provide international liquidity on a short and medium term and encourage liberalization of exchange rates. The IMF helps its members to tide over the balance of payments problems with supplying the necessary loans.

    IMM=International Monetary Market

    The International Monetary Market (IMM), largely the creation of Leo Melamed, is part of the Chicago Mercantile Exchange (CME), the largest futures exchange in the United States and the second largest in the world after Eurex, for the trading of futures contracts and options on futures. The IMM was started on May 16, 1972. Two of the more prevalent contracts traded are currency futures and interest rate futures.

    Implied Rates

    The interest rate determined by calculating the difference between spot and forward rates.


    A call option is in-the-money if the price of the underlying instrument is higher than the exercise/strike price. A put option is in-the-money if the price of the underlying instrument is below the exercise/strike price.

    Inconvertible Currency

    Currency which cannot be exchanged for other currencies either because it is forbidden by the foreign exchange regulations or the currency witnesses extreme volatility that it is not percieved to be a safe haven for parking the funds.

    Index Linking

    The periodic adjustment of the money values of some regular scheduled payments based on the movement of the CPI or some other price index. The payments may be wages or salaries, social security or other pensions, other social security benefits, rents, interest payments, etc.

    Index of Consumer Confidence

    The Index of Consumer Confidence (CCI) measures how people feel about the United States economy. It is issued monthly by The Conference Board, an independent economic research organization, and is based on 5,000 households. Such measurement is indicative of consumption component level of the gross domestic product. The Federal Reserve looks at the CCI when determining interest rate changes, and it also affects stock market prices.

    Indicative Quote

    In forex trading, a currency quote that is provided by a market maker to a trading party but that is not firm. In other words, when a market maker provides an indicative quote to a trader, the market maker is not obligated to trade the given currency pair at the price or the quantity stated in the quote. Contrast this to a firm quote, in which a market maker guarantees a specified bid or ask price to a trader up to the maximum quantity specified in the quote.
    Market makers will typically provide indicative quotes if a trader requests a quote for a currency pair but does not specify the quantity to be traded, or if there is some doubt as to the market maker's ability to transact the currency pair at the bid or ask quoted. The bottom line is that traders can rely on indicative quotes as a reasonable estimate of the exchange rate at which they can enter their currency trade, but there is no guarantee that this will be the rate they get.

    Indirect quote

    See reciprocal currency.

    Industrial New Orders

    The value of new contracts for goods produced by the manufacturing sector. A rising level of Industrial New Orders forecasts increased production and a rising GDP. There are two headline numbers released for this report, month to month and annualized change.

    Industrial Production

    The index of industrial production measures the physical output of the nation's factories, mines and utilities

    Industrial Production Index-IPI

    An indicator that shows the production output from industrial activities, such as mining, manufacturing and utilities. It is released by the Federal Reserve Board each month.


    An economic condition whereby prices for consumer goods rise, eroding purchasing power.

    Info Quote

    Rate given for information purposes only.

    Initial Margin
    This is the deposit required by a broker in order for a trader to start a transaction.

    Initial Margin Requirement

    The minimum portion of a new security purchase that an investor must pay for in cash.


    The specification of the banks at which funds shall be paid upon settlement.

    Inter-dealer Broker

    A specialist broker who acts as an intermediary between market-makers who wish to buy or sell securities to improve their book positions, without revealing their identities to other market-makers.

    Interbank Rates

    The Foreign Exchange rates at which large international banks quote other large international banks.

    Interest Rate Futures

    An Interest Rate Future is a futures contract with an interest-bearing instrument as the underlying asset. Examples include Treasury-bill futures, Treasury-bond futures and Eurodollar futures. The global market for exchange-traded interest rate futures is notionally valued by the Bank for International Settlements at $5,794,200 million in 2005.

    Interest Rate Risk

    The potential for losses arising from changes in interest rates

    Intermarket Analysis

    An analysis of an underlying asset that incorporates examinations of various markets. Namely, four markets are examined: currencies, commodities, stocks, and bonds. Intermarket analysis is centered on the idea that the four markets are correlated.

    International Capital flows= TIC flows

    Summarizes the flow of stocks, bonds, and money market funds to and from the United States . The headline figure is the difference in value between American purchases of foreign securities and foreign purchases of American securities, expressed in millions of dollars. The Treasury International Capital or TIC statement is a major component of the American capital account and gives valuable insight into foreign demand for American investments and dollar.

    A positive figure indicates that more capital is entering the US than leaving as sales of American securities to foreigners exceed American purchases of foreign securities. Such positive figures suggest that American security markets are competitive with those of other countries. Foreign security purchases are especially important in the case of a trade deficit, as a positive figure can offset the depreciating effect of a trade shortfall. On the contrary, a negative or declining TICS figure reflects a declining capital flow picture. Outflows are indicative of weaker demand for US assets which puts downward pressure on the value of the dollar.

    A key feature of the TIC data is its measurement of the types of investors the dollar has; governments and private investors. Usually, a strong government holding of dollar denominated assets signals growing dollar optimism as it shows that governments are confident in the stability of the U.S. dollar. Most importantly seems to be the purchases of Asian central banks such as that of Japan and China. Waning demand by these two behemoth US Treasury holders could be bearish for the US dollar. As for absolute amount of foreign purchases, the market generally likes to see purchases be much stronger than the funding needs of that same month's trade deficit. If it is not, it signals that there is not enough dollars coming in to match dollar going out of the country. As a side note, purchases by Caribbean central banks are generally seen to be less consistent since most hedge funds are incorporated in the Caribbean. Hedge funds generally have a much shorter attention span than other investors.

    International Merchandise Trade-Canada

    The difference between imports and exports of goods. Merchandise Trade differentiates itself from Trade Balance because it does not record intangibles like services, only reporting on physical goods. Because exports of tangibles like oil, gold and manufacturing contribute to a large part of Canada 's GDP, trade data can give critical insight into developments in the economy and into foreign exchange rates.

    International Securities Dealers Association - ISDA

    Organization which foreign currency exchange banks have formed to regulate inter-bank markets and exchanges.

    International Swaps and Derivatives Association- ISDA

    Organization defining the terms and conditions for derivative trades.


    Action by a central bank to effect the value of its currency by entering the market.

    Intra-Day limit

    Limit set by bank management on the size of each dealer's Intra Day Position.

    Intra-Day Position

    Open positions run by a dealer within the day. Usually squared by the close.


    During a single trading day.

    Intrinsic Value

    The amount by which an option is in-the-money. The intrinsic value is the difference between the exercise/strike price and the price of the underlying security.

    Inverted Market

    A futures market in which the nearer months are selling at premiums over the more distant months; characteristically, a market in which supplies are currently in shortage.

    Investment Lending

    The value of loans provided to individuals and corporations. An increase in Investment Lending forecasts growth in the economy since greater capital investments typically finance expansions of output and productivity and usually occur in periods of high consumer and business confidence. During these periods borrowers are willing to make investments because they hold reasonable expectations that their investments will pay off in the future. By making these investments, borrowers both increase private expenditure and enhance the future productive capacity of the economy. Though, this figure typically does not have significant impact upon markets.

    The figure is reported as a seasonally adjusted percentage change from the previous month.


    A term for exports and imports of services as distinct from merchandise


    Index and Options Market- part of the Chicago Mercantile Exchange.


    Industrial Production Index. A coincident indicator measuring physical output of manufacturing, mining and utilities.


    initial public offering: a company's first stock offering to the public.

    ISDA - International Securities Dealers Association

    Organization which foreign currency exchange banks have formed to regulate inter-bank markets and exchanges.


    Institute for Supply Management

    ISM Manufacturing

    ISM Manufacuring assesses the state of US industry by surveying executives on expectations for future production, new orders, inventories, employment and deliveries. Though manufacturing accounts for a relatively small portion of GDP, fluctuations in manufacturing tend to bear the most responsibility for changes in GDP. Consequently, developments in manufacturing often front run trends in the overall economy, making the ISM Manufacturing figure a leading indicator of economic turnarounds. A pickup in demand for manufactured products after a period of recession, reflected by a higher ISM figure, strongly suggests a reversal upward. Conversely a slowdown in manufacturing orders and production during a boom suggests a slowing of the economy. The ISM Manufacturing Survey is valued for its timeliness, and indeed, during waning boom cycles analyst point out that ISM tends to be one of the biggest market moving economic releases. The reasoning lies within the ISM's Prices Paid and Employment subcomponents. These components reflect sentiment towards inflation and labor conditions - two of the market's most significant health indicators. Given that the ISM's timeliness, the information gleaned from such components precedes other market data (like Non-Farm Payrolls or CPI), making the ISM a significant indicator.

    The headline figure is expressed as a diffusion index based on survey responses. For each category (production, new orders etc.), the index is calculated by adding the percentage of executive responding "higher" with half the percentage of "no change" responses, and subtracting the percentage of "lower" responses. The ISM manufacturing indicator is the aggregate of the results for all categories.

    Values over 50 generally indicate an expansion, while values below 50 indicate contraction.

    Retail Sales can be volatile due to seasonal fluctuations in demand. Thus the headline figure is the seasonally adjusted percentage change in sales compared to the previous year.

    ISM Non-Manufacturing - United States

    ISM Non-Manufacturing gauge of business conditions in non-manufacturing industries, based on measures of employment trends, prices and new orders. Though non-manufacturing sectors make up the majority of the economy, the ISM Non-Manufacturing has less market impact because non-manufacturing data tends to be more cyclical and predictable. However, these sectors do account for a considerable portion of CPI. As a result, the figure gives insight into conditions which can impact output growth and inflationary pressures.


    ISO is the short name (not acronym) for the International Organization for Standardization.


    Italian National Statistics Institute

    Ivey Purchasing Managers Index (PMI) - Canada

    A monthly measure of the change in purchases by corporate executives. One hundred and seventy-five managers distributed among different regions and sectors are asked: "Are your purchases higher, the same, or lower than the previous month" A headline value above 50 indicates an increase in purchases from the previous month and a value below 50 indicates a decrease.
    Last edited by PCMAnalyst; 05-04-2014 at 10:26 AM.

  12. ARIONFORXtarder

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