Direct Paper CP or commercial paper that is directly purchased by investors from issuers. … [Read more...]
Index Fund
Filed Under: i by
Index Fund Pool of funds from investors that is tailored to match a stock market index’s returns. … [Read more...]
Inverted Market
Filed Under: i by
Inverted Market Related to premium. Futures market where the contracts with dates nearest the present month are selling at a higher price than those with dates in a distant month. … [Read more...]
External Efficiency
Filed Under: e by
External Efficiency Refer: pricing efficiency. Degree to which asset price reflects the information pertinent to it. … [Read more...]
Stochastic Models
Filed Under: s by
Stochastic Models Models based on random (or non deterministic) outcomes. Commonly applied to option pricing and liability payments. Random Finance Terms for the Letter S Statement of Financial Accounting Standards No. 8 Statement of Financial Accounting Standards No. … [Read more...]
Arms Index
Filed Under: a by
Arms Index Also termed trading index (TRIN). Indicates up/ down trend in the market. A bearish trend is indicated by an above 1.0 figure while bullish trend is indicated by a lower than 1.0 figure. … [Read more...]
Fixed-Dates
Filed Under: f by
Fixed-Dates Terminology used in Euromarket. Refers to the standard periods of trading for Euros. The period may range between 1 month out and a year out. … [Read more...]
Currency Option
Filed Under: c by
Currency Option A buy or sell option on foreign currency. … [Read more...]
Forced Conversion
Filed Under: f by
Forced Conversion Calling in of convertible security by issuer. This prompts bondholders to exercise their conversion option. … [Read more...]
Taxable Acquisition
Filed Under: t by
Taxable Acquisition It is an acquisition (or merger) where the taxes need to be paid by the shareholders selling their stock. Random Finance Terms for the Letter T Tax Shield Tax Swap Tax-Deferred Retirement Plans Tax-Timing Option Taxable Acquisition Taxable … [Read more...]
Intermediate/Medium-Term Debt
Filed Under: i by
Intermediate/Medium-Term Debt Fixed income security that matures in the following 3 – 10 years. Maturity date is a very important parameter in evaluating bond products and is used to calculate yields. … [Read more...]
Multiple-Issuer Pools
Filed Under: m by
Multiple-Issuer Pools Pool of funds created from aggregating the loan packages of different issuers under the GNMA-II program. … [Read more...]
Magic of Diversification
Filed Under: m by
Magic of Diversification Related: Markowitz diversification Reduction of risk effectively achieved in a portfolio without adversely impacting expected returns by means of accurate combination of the portfolio’s assets with low or negative correlations (covariances). … [Read more...]
Creation Unit
Filed Under: c by
Creation Unit The collection of shares/ securities that is one unit of a trust fund that underlies an ETF. … [Read more...]
Opening Price
Filed Under: o by
Opening Price Prices reigning during the opening phase of the trading session and at which the transactions were executed. Random Finance Terms for the Letter O Opening Price Opening Purchase Opening Sale Operating Cash Flow Operating Cash Flow Ratio Operating … [Read more...]
Foreign Currency Translation
Filed Under: f by
Foreign Currency Translation Accounting process that involves representation of subsidiaries’ foreign currency accounts in terms of the reporting currency that is used by parent company. Consolidated financial accounts are generated thus. … [Read more...]
Federal Financing Bank
Filed Under: f by
Federal Financing Bank Federal government institution that makes loans to various federal credit agencies from funds obtained from U.S. Treasury borrowings. … [Read more...]
Expected Value of Perfect Information
Filed Under: e by
Expected Value of Perfect Information The value expected in the event that future unknown outcomes could be predicted less the expected value without any information in addition being available. … [Read more...]
Swap Rate
Filed Under: s by
Swap Rate The gap (negative or positive) between the forward and spot rates for a specific currency, expressed in the form of points. Random Finance Terms for the Letter S Swap Rate Swap Reversal Swap Sale Swaption Sweep Account Swingline Facility … [Read more...]
Letter of Credit (L/C)
Filed Under: l by
Letter of Credit (L/C) A kind of guarantee of payment, made by a bank on bond issues, to guarantee the repayment of principal as well as interest payments. … [Read more...]
