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E - When E is the fifth letter of a NASDAQ stock symbol,
the stock has not met its requirement for filing with the SEC.
Early Exercise - Exercise of a put or call option before its expiration
date.
Early Exercise Price Trigger - The provision of CAPS contracts under
which the CAPS option terminates early with settlement at its maximum
value if the underlying index at the market close is priced at or above
a call (below a put) outstrike price.
Early Redemption (Put) Option - A feature of some bonds with both fixed
and floating rates that allow the holder to sell the bonds back to the
issuer or a third party at or near par if interest rates rise or the
issuer's credit rating declines.
Early Termination Date - In the event of a default, the date in which
final obligations are calculated.
Earning Power - Earnings before interest and taxes (EBIT) divided by
total assets.
Earnings - Net company income.
Earnings Before Interest And Taxes (EBIT) - Operating and non-operating
profit before the deduction of interest and income taxes.
Earnings Before Interest, Taxes And Depreciation (EBITD) - Operating and
non-operating profit before the deduction of interest and income taxes,
not including depreciation expenses.
Earnings Before Interest, Taxes, Depreciation And Amortization (EBITDA)
- Operating and non-operating profit before the deduction of interest
and income taxes, not including depreciation and amortization expenses.
Earnings Before Taxes (EBT) - Operating and non-operating profit before
the deduction of income taxes.
Earnings Per Share - A company's profit divided by its number of
outstanding shares.
Earnings Surprises - Differences, either positive or negative, from the
consensus forecast earnings.
Earnings Yield - The inverse of the price/earnings ratio. The ratio of
earnings per share after allowing for tax and interest payments on fixed
interest debt, to the current share price.
Ecart - The price difference of a swiss company's bearer shares and its
registered shares. The registered shares usually trade at a discount
because they cannot be owned by foreign investors.
Econometric Model - Regression techniques used to forecast the values of
economic and financial variables.
Economic Assumptions - The economic environment that a company plans to
operate in.
Economic Dependence - The situation where the revenues and/or costs of
one project depend on that of another.
Economic Earnings - The amount of cash a company could pay out forever
if there were no changes in the company’s production capacity.
Economic Exposure - The fact that the value of a company will change
with the exchange rate.
Economic Hedge - Currency hedge to eliminate the factor of production
cost advantage of a competitor with a depreciating currency.
Economic Income - Cash flow plus change in present value.
Economic Rents - Profits above the competitive level.
Economic Risk - The possibility that a project’s output and salable
price will not cover the project’s costs, including operating and
maintenance costs as well as the project’s debt service requirements.
Economic Statistics Effect - Trend in which volatility of an instrument
increases prior to the release of economic data or company results and
decreases when the news is released because the uncertainty surrounding
the release is gone.
Economic Surplus - The difference between market value of assets and
market value of liabilities for a particular entity.
Economic Union - An agreement between countries allowing the free
movement of all goods and services, capital, and labor.
Economic Value Added (EVA) - Equal to the Net Operating Profit After Tax
(cash flow) – (Capital multiplied by the Weighted Average Cost of
Capital).
Economically Targeted Investment (ETI) - Investment not expected to a
return target, but that is carried out for non-investment or legal
reasons.
Economies Of Scale - The decrease in marginal cost (or per unit cost) of
production as a company’s scale of operations increases.
Economies Of Scope - A situation where the same investment can support
numerous profitable activities less expensively in combination than it
could separately.
EDGAR- (Electronic Data Gathering And Retrieval) - System used by SEC in
order to transmit company documents.
Edge - A dealer's expected proceeds on a transaction.
Edge Corporations - Banking institutions that are chartered by the
Federal Reserve Board to engage in transactions of international
character.
Effect The Market - Referring to general equities, a change in stock
price or trade volume levels by an artificial demand or supply such as a
corporate repurchase.
Effective Annual Interest Rate - The time value of money reflecting the
effects of compounding; an annual measure.
Effective Annual Yield - An annualized interest rate on a security
computed using compound interest.
Effective Convexity - Using cash flows that change with yields, the
calculation of the convexity of a bond.
Effective Date - The date that interest begins accruing in an interest
rate swap; date when an initial public offering (IPO) begins trading
(usually 20 days after the filing of the offering statement.
Effective Duration - A measure of the responsiveness of a bond’s price
while accounting for the fact that expected cash flows will change with
changes in interest rates (due to the embedded option).
Effective Margin (EM) - The amount equal to the margin of income on
assets in excess of financing costs for a specified interest rate and
prepayment rate situation.
Effective Rate - Measure of the time value of money that reflecting the
effects of compounding.
Effective Spread - The underwriting spread, with adjustment for the
impact of a common stock offering’s announcement on the company’s share
price.
Efficiency - A measure of the speed to which a market accurately
incorporates information into its prices.
Efficient Capital Market - A market that quickly and effectively
reflects new information in its share prices.
Efficient Frontier - The maximization of expected return for any level
of expected risk or the minimization of expected risk for any level of
expected return.
Efficient Holder of an Instrument - Owner of an instrument that contains
resources such as Tax and regulatory factors beneficial to the holder
yet unattractive to some potential users.
Efficient Market - A trading market in which the all available
information from past prices and volumes is reflected in the current
price.
Efficient Market Hypothesis - A hypothesis that states that one should
not expect to earn an unusually high rate of return either through
technical or fundamental analysis of the market.
Efficient Plane - A surface of portfolios that have the highest expected
returns for their given levels of standard deviations and tracking error
plotted in dimensions of expected return, standard deviation, and
tracking error.
Efficient Portfolio - A portfolio that gives the greatest expected
return given the risk, or conversely, the lowest risk given the expected
return.
Efficient Portfolio Management - Management of an account which
generates additional capital or income or reduce cost or risk.
Efficient Set - A graph comparing expected return versus the level of
risk for a given portfolio.
Eigenvalues - Statistic used to calculate the fraction of the variation
in a security's return that is accounted for through factor analysis.
Eigenvectors - In factor analysis, linear combinations of securities
comprising both long and short positions, that explain virtually all of
the covariation in the returns of a sample of securities.
Either-Way Market - Referring to the Eurodollar deposit market, a market
where the bid and offered rates are the same.
Either/or Facility - A bank that gives its customer the option of
borrowing either domestic dollars from the its main office, or
Eurodollars from one of its foreign branches.
Elasticity - Response of one value to a relative change in another value
in a security or index. Ex. Reaction of price to volume.
Elasticity Of An Option - A percentage change in an option’s value when
a 1% value change in the underlying stock occurs.
Election Warrant - A warrant with its decisive pay-off or redemption
value likely to depend on the results of an election.
Electric Fence - A long position in an underlying instrument which sells
forward at a premium is combined with a long lookback put on the full
value of the underlying and a short lookback call covering enough of the
notional value of the underlying to generate a premium equal to the put
premium.
Electricity Forward Agreement (EFA) - A contract calling for the
delivery of and payment for electric power in a future period. .
Electronic Data Interchange (EDI) - The electronic exchange of data
between the computer’s of two separate companies.
Electronic Depository Transfers - The transfer of funds between bank
accounts through an automated system.
Electronic Money - Debit and credit transfers over an electronic network
instead of transferring money in a material form.
Electronic Trade Confirmation (ETC) - Paperless trade displayed on a
network.
Eligible Bankers' Acceptances - An acceptance is deemed eligible if it
is acceptable by the Fed as collateral at the discount window, or
because it can be sold without incurring a reserve requirement.
Eligible Swap Participant - Party permitted to enter into swap
agreements exempt from regulation by the Commodity Futures Trading
Commission (CFTC). These parties include banks and trust companies,
savings associations, insurance companies, commodity pools,
corporations, partnerships, proprietorships, and other organizations,
including trusts, employee benefit plans, governmental entities,
broker/dealers, futures commission merchants, and any natural person
with total assets exceeding $10 million.
Elliott Wave Theory - Referring to general equities, A market strategy
using timing based on historical price wave patterns and underlying
psychological motives.
Embedded Option - As opposed to a bare option, an option that is part of
a bond that allows either the issuer or the bondholder the right to take
action against the other party.
Emerging Issues Task Force (EITF) - A committee of the Financial
Accounting Standards Board (FASB) responsible for providing appropriate
guidance on rising accounting issues in a timely manner.
Emerging Market Warrants - Covered options or warrants on common stocks,
stock baskets, indexes, or bonds traded in an undeveloped market in
which the writer receives a high premium in return for protecting the
buyer from unwanted market characteristics.
Emerging Markets - The markets of developing economies.
Empirical - Conclusion based on observation rather than assumption.
Empirical conclusions are done as a result of testing a hypothesis.
Employee Retirement Income Security Act (ERISA) - Act that regulates of
the administration, investment, and risk management policies of pension
and profit sharing employee benefit plans in the United States.
Employee Stock Fund - A program that allows employees to purchase shares
of the company's common stock on a preferential basis.
Employee Stock Ownership Plan (ESOP) - A plan where the company
contributes to a trust fund that purchases the company’s stock on the
behalf of the employees; plan where employees are entitled to buy shares
of stock in the company, often at a favorable price.
End Users of Derivatives Association (EUDA) - Information sharing and
coordination organization for derivative end users created as a result
of a number of end user derivatives losses.
End-Of-Year Convention - A method entailing treating cash flows as if
they occurred at the end of the year as opposed to the date that each
was incurred.
Endorsement - Support by a creditworthy backer of a derivative contract
to guarantee performance.
Endowment Funds - An investment fund that supports an institution such
as a college, museum, or foundation.
Enhanced Derivatives Product Companies (EDPCs) - AAA-rated subsidiaries
of lower-rated financial intermediaries that are counterparties or
issuers of derivatives products.
Enhanced Indexing - An approach to indexing where the objective is to
exceed or meet the total return performance of some predetermined index.
Enhancement of a Position - The use of arbitrage-type substitution
techniques to increase a position’s return without materially changing
its risk characteristics.
Enterprise Value - The market value of a corporation's total
capitalization: equity plus debt minus core business assets.
Equal Dollar Swap - Referring to general equities, selling common stock
or convertibles invested in one company, and then reinvesting the money
in either the same number of another type of security issued by the same
company, or another security of the same kind issued by a different
company.
Equal Shares Swap - Often refers to convertible securities, selling an
underlying common and then reinvesting the money in as much convertible
as could be converted into the number of shares just sold.
Equilibrium Market Price Of Risk - In market analysis, the slope of the
capital market line which represents the expected return offered in
response to a perceived risk.
Equilibrium Rate Of Interest - The trade clearing interest rate.
Equipment Trust Certificates - Certificates issued by a trust that
purchases an asset in order to lease it to a lessee. After the
certificate has been repaid, the asset is owned by the lessee.
Equitize Cash - Purchase of an equity futures, forward, or options
synthetic position and collateralized with a previously held cash
equivalent position.
Equity - Ownership in a firm.
Equity Basket Option - An option on a portfolio consisting of more than
one stock or stock market index. The investor expects the portfolio to
move significantly over the life of the option and attempts to take
advantage of the fact that premiums are usually lower on basket options
than on separate options on each of the basket's components.
Equity Buyback Obligation Rights (EBORs) - Puts sold by the issuer of
the underlying stock which gives the owner the right to sell the
company's stock at a fixed price for a designated period.
Equity Cap - An agreement in which one party is compensated at certain
times if a designated stock market benchmark is greater than a
predetermined level. Compensation is made by a party who has previously
collected a premium.
Equity Claim - A claim to a share of earnings once debt obligations have
been met.
Equity Collar - The purchase of an equity floor and the sale of an
equity cap at the same time.
Equity Contract Notes - Bank issued debt with mandatory convertibility
into common stock.
Equity Contribution Agreement - An agreement that stipulates that a
party will contribute equity to a project under certain conditions.
Equity Floor - An agreement in which one party is compensated at certain
times if a designated stock market benchmark is less than a
predetermined level. Compensation is made by a party who has previously
collected a premium.
Equity Forward - A forward contract for the transaction of an equity
instrument or index at a later date.
Equity Index LIBOR- Linked Installment Premium Opt - An equity index
installment option with the level of each installment premium determined
by the level of LIBOR on each payment date.
Equity Indexed Annuity (EIA) - Equity-linked note (ELN) wrapped in an
annuity to achieve tax deferral.
Equity Kicker - Usually refers to a warrant that is attached to a
privately placed bond.
Equity Multiplier - The total assets per dollar of stockholder equity
calculated by dividing the total assets by the total common
stockholders’ equity.
Equity Option - A security that gives the holder the right to either buy
or sell a certain number of shares of stock at a specified price, or not
buy or sell. The holder only has this right for a limited period of
time.
Equity Range Note - A stock or stock index range note with the return
dependent on the behavior of a stock or stock index relative to a
designated price range.
Equity Risk Reversal - A strategy in which the investor buys a put which
provides downside protection and pays for the put with the sale of a
call, which caps upside return.
Equity Structured Call And Put Exposure (ESCAPE) - Equity-linked note
created with options to avoid unfavorable tax consequences.
Equity Swap - A swap in which cash flows are exchanged based on the
total return on some market index and an interest rate.
Equity Warrant - A put or call with a single common stock issue as the
underlying.
Equity Yield Enhancement Security (EYES) - Instrument with a single
stock as the underlying, a coupon that exceeds the dividend on the
underlying stock, and a capped return. The higher coupon is purchased
with the proceeds from the cap.
Equity-Enhanced Dedication - A form of portfolio insurance using a
dedicated bond portfolio with little risks and assets and common stocks
or stock index futures as the risky asset. This technique is designed to
maintain a ceiling on underfunding while providing equity risk and a
chance to enhance the ratio of assets to liabilities.
Equity-Linked Certificate of Deposit (ELCD or ECD) - Bank issued
equity-linked note which carry FDIC deposit insurance in the U.S. and
the issuer may impose a penalty for early withdrawal.
Equity-Linked Foreign Exchange (Elf-X) Option - An elf-X will provide
the right to buy or sell enough currency at the strike exchange rate to
purchase or sell a specified foreign equity position without fear that
foreign currency appreciation will increase the cost or decrease the
value of the position in the investor's home currency.
Equity-LinKed Security (ELKS) - An enhanced dividend, capped return
instrument issued by a third party, frequently a financial intermediary.
Equityholders - Investors that hold shares in a company’s equity.
Equivalent Annual Benefit - An annuity for the net present value of an
investment project: an equivalent annual annuity.
Equivalent Annual Cash Flow - An annuity that has the same net present
value as the company’s proposed investment.
Equivalent Annual Cost - The equivalent annual cost of owning an asset
for the duration of its life.
Equivalent Bond Yield - An annual yield on a short-term security
calculated for comparison purposes, comparing to yields quoted on coupon
securities.
Equivalent Taxable Yield - Yield required for a tax-free security to
equal the after-tax yield of a taxable bond, taking into account the
investor’s tax bracket.
Escrow Receipt - A document providing evidence of deposited collateral.
Escrowed To Maturity (ETM) Bonds - Deposit of a municipal with Treasury
securities in escrow by a debtor to cover all coupon and principal
payments.
EUREX - Abbreviation for the European derivatives exchange.
Euro - A deposit made outside of one’s home country, but in the home
country’s currency.
Euro CDs - Usually issued in London; CDs that are issued by a US bank
branch or foreign bank that is located outside of the United States.
Euro Lines - Lines of credit given by banks in the Euromarket for
Eurocurrencies.
Euro-Commercial Paper - Short-term notes issued by firms on
international money markets.
Euro-Medium Term Note (Euro-MTN) - A Euronote issued directly to the
market, offered continuously, and not underwritten.
Euro-Note - A debt instrument sold in the Eurocurrency market.
Eurobank - A financial institution that accepts foreign currency
deposits.
Eurobond - A bond that is issued simultaneously to investors in various
countries, issued outside of the jurisdiction of any one country, and is
underwritten by an international syndicate.
Euroclear - A clearing system, located in Brussels, for the Eurobond
market.
Eurocredits - Eurocurrency loans made to corporate and government
borrowers by banking syndicates.
Eurocurrency - Money denominated in a currency other than the local
currency.
Eurocurrency Deposit - A short-term deposit denominated in a currency
other than the local currency.
Eurocurrency Market - The borrowing and lending market for currencies
that are held as deposits in banks located outside of the country where
the currency was issued.
Eurodollar - A certificate of deposit in US dollars that is in a bank
not located in the United States.
Eurodollar Bond - A Eurobond that is denominated in US dollars.
Euroequity Issues - Securities sold in the Euromarket.
European Currency Unit (E.C.U.) - A foreign exchange index that consists
of approximately 10 European currencies.
European Currency Unit (ECU) Bond - A Eurobond denominated in the ECU in
which interest and principal can be paid in ECUs or in any of the ECU
member currencies at the discretion of the holder.
European Exchange Rate Quotation Convention - Used in currency markets
to exhibit exchange relationships in terms of the number of units of the
foreign currency per dollar.
European Monetary System - The system formed in 1979 that includes the
currencies of the European Union member countries.
European Monetary Union - An unclear plan which would replace the
numerous currencies of member countries with the European currency unit
(ECU).
European Option - Options that are only exercised on the expiration
date.
European Union - An association created by the Treaty of Rome in 1957 as
a common market for numerous European nations.
Eurowarrants - Warrant contracts traded in the Euromarkets.
Euroyen Bonds - Eurobonds that are denominated in Japanese yen.
Evaluation Period - The time period during which a money manager’s
performance is evaluated.
Evening Up - The act of buying or selling in order to offset an existing
market position.
Event Risk - The risk that a rare, unanticipated, and/or very large
change will occur and render an issuer unable to make payments.
Event Risk Covenant - A bond provision that states that in the event of
a corporate takeover, a merger, or an anti-takeover restructuring that
would dissipate significant corporate assets, the bond is redeemable at
par.
Event Study - A study based on price changes caused by the release of
information.
Events Of Default - Events specified by contract that allow a lender to
demand immediate repayment of a debt.
Evergreen Credit - Credit that revolves without maturing.
Ex-dividend - Without dividend. Referring to general equities, the time
period between the announcement and the payment date during which the
stock will trade without its dividend.
Ex-dividend Date - The first day of trading when the seller is entitled
to a recently announced dividend payment
Ex-Rights - Referring to a rights offering, stocks that trade without
rights attached.
Ex-Rights Date - The date on which a share of common stock begins
trading without rights attached.
Ex-Warrants - An instrument resold without the warrants formerly
attached to the instrument at issuance.
Exact Matching - A strategy involving locating the lowest cost portfolio
generating cash
Exante Return - The expected return of a portfolio.
Except For Opinion - An auditor’s opinion with the stated exception for
areas that the auditor was unable to examine due to conditions beyond
the auditor’s control.
Excess Kurtosis - When a distribution has fatter tails than normal
distribution.
Excess Returns - Returns in excess of those required.
Exchange - Market in which stocks, bonds, commodities, options and
futures on stocks, and indices are traded.
Exchange Controls - Regulations imposed by the government on the
purchase of foreign currencies by its citizens, as well as on the
purchase of local currency by foreigners.
Exchange for Swap - Used by banks to avoid taking physical delivery of
commodities by delegating the bank's futures positions to a dealer’s
account and swaps the commodity return for a funding rate.
Exchange Fund - An investment vehicle allowing large investors to
exchange their holding in a single stock for shares in the diversified
portfolio of stocks in a tax-free transaction.
Exchange Of Assets - Purchase of a company through acquisition of its
assets in exchange for stock or cash.
Exchange of Futures for Physicals (EFP) - A technique which is used to
adjust underlying cash market positions at a low trading cost by
exchanging a position in the underlying for a futures position. In
futures markets, the EFP bypasses any cash settlement mechanism that is
embedded in the contract and substitutes physical settlement.
Exchange Of Stock - Purchase of a company through acquisition of its
assets in exchange for shares or cash.
Exchange Offer - An offer whereby a firm will give a security of one
type, such as a bond, in exchange for a security of another type, such
as shares of common stock.
Exchange Option - An option to relinquish one asset in exchange for
another.
Exchange Rate - The price of the currency of one country expressed in
that of another.
Exchange Rate Agreement (ERA) - Agreement in which the settlement rate
increases or decreases as the spread between two forward exchange rates
go up or down.
Exchange Rate Mechanism - The method used to maintain the currency
exchange rates within the agreed upon range.
Exchange Rate Risk - The risk assumed because of possible changes in
currency exchange rates.
Exchange Risk - The risk of a firm’s value changing due to currency
exchange changes.
EXchange-TRAded (EXTRA) Funds - Modified unit trusts or mutual fund-type
investment funds that can trade by two methods. Primary trading is in
blocks of 50,000 or more shares through the deposit or payment in the
fund's portfolio. Secondary trading, in smaller lots takes place on a
stock exchange. The dual trading is utilized in order for the shares to
close daily at net asset value.
Exchange-Traded Contracts - Standardized options and futures listed and
traded on a regulated exchange.
Exchangeable - Often refers to convertible securities, the right of an
issuer to exchange a convertible debenture for an existing convertible
preferred with the same terms.
Exchangeable Auction Rate Preferred Stock - An auction rate preferred
stock that is redeemable at the issuer's option for auction rate notes
on any dividend payment date.
Exchangeable Debt - A bond or note issued by a corporation which is
'convertible' into the shares of another company which the corporation
has a position in.
Exchangeable Instrument - Often referring to convertible securities, a
bond or preferred stock that is exchangeable into a common stock of
another public company.
Exchangeable Payment-In- Kind (PIK) Preferred Stock - Stock in which the
issuer has the option to convert into debt.
Exchangeable Security - A security that allows the holder to exchange it
for the common stock of another firm, if so desired.
Exchangeable Zero-Coupon Swap - Swap in which the end-user who is
scheduled to receive a fixed sum at maturity sells the dealer an
embedded option to convert the single payment to a series of fixed
payments. The end user will benefit from this structure if volatility
and rates decline.
Exclusionary Self-Tender - The act of a company making a tender offer
for a given amount of its own stock while excluding targeted
stockholders.
Exclusive - Referring to general equities, having no competition in
regard to a customer order or indication.
Execution - Completing an order to buy or sell a security.
Execution Costs - The difference between a security’s execution price
and its price had it not been traded.
Execution Risk - The chance that a desirable transaction cannot be
executed within the circumstances of recent market prices or within
limits proposed by an investor. Investors always have execution risk in
virtually all financial instruments, unless a principal (dealer) can
guarantee a specific execution.
Exempt Securities - Securities that are exempt from the registration
requirements of imposed by the Securities Act of 1933 and the margin
requirements of the SEC Act of 1934.
Exercise - Implementing a holder’s right to either buy or sell an
underlying security.
Exercise Limit - A limit on the number of exchange-traded option
contracts that can be exercised by one holder within a specified time
period.
Exercise Notice - A notification that the buyer of an option wishes to
exercise and obtain the appropriate cash settlement or physical delivery
of the underlying from the seller.
Exercise Price - The price at which an underlying security is bought or
sold, the "strike price."
Exercise Procedure - The course of action taken in a contract or set in
the rules on an exchange for exercising options.
Exercise Settlement Amount - The difference between the exercise price
of the option and the exercise settlement value of the index on the day
an exercise notice is tendered, multiplied by the index multiplier.
Exercise Value - The advantage provide by an in the money option over a
current market transaction.
Exercising The Option - The act of exercising (buying or selling) an
underlying asset.
Exhaust Price - The price of a security at which the equity of a margin
account would be depleted.
Exit Bond - Bond that exempts the holder of the bond from further
rescheduling or a future lending obligation based on its position in
this instrument.
Exogenous Variable - A statistical variable that is determined
separately from the model in which it will be used.
Exotic Derivatives - Derivative instruments which contain more than one
basic financial instrument, such as Inverse Floaters or Equity-Linked
Notes.
Exotic Options - Options with unusual underlyings, strike price
calculations, strike price determinations, payoff mechanisms, or
expiration conditions.
Expectations Hypothesis Theories - Theories stating that each forward
rate equals the expected future interest rate for the relevant period;
theories in regard to the term structure of interest rates.
Expectations Model - A theory of forward or futures price determination
that stresses the significance of price or return expectations.
Expectations Theory Of Forward Exchange Rates - Theory in regard to
foreign exchange rates: theory stating that the expected future spot
foreign exchange rate t-periods from now equals the current t-period.
Expected Credit Loss - The average cost of defaults anticipated over an
extended period of time in a swap or debt instrument investment program.
Expected Dividend Yield - Total dividends received for holding a stock
for a year, or the amount of dividends received on the index for the
life of a futures contract.
Expected Future Cash Flows - Projected cash flows in regard to a
specific asset.
Expected Future Return - Expected return on an asset.
Expected Return - The expected return on an asset that has a high risk,
based on probabilities.
Expected Return On Investment - The return that can be expected on a
particular investment.
Expected Return-Beta Relationship - The relationship between an expected
return and beta: the implication of the CAPM that the risk premiums will
be in proportion to beta.
Expected Value - The mean value, or the weighted average of a
probability distribution.
Expected Value Of Perfect Information - The expected value if there were
no uncertain outcomes less the expected value.
Expected Volatility - Option analyst’s value of an underlying's
volatility forecasted over the life of the option.
Expense Ratio - The ratio, expressed as a percentage of the assets of a
mutual fund, indicating the amount spent to run the mutual fund.
Expensed - Costs charged to an expense account. These items include
expenditures for items with useful lives of less than one year.
Expiration - The time when an option contract ends or expires.
Expiration Cycle - A term relating to the dates on which option
contracts expire.
Expiration Date - The final day in which an option contract can be
exercised.
Expiration Price - A drop out price in a barrier or out option.
Exploding Option - An equity risk reversal structure in which the short
option expires, and the long option pays off at maximum value when the
underlying trades through the outstrike price instantaneously or as of
the close of a trading session.
Exponential Moving Average - An averaging system that weights recent
data more heavily (at a geometric rate) than data from the distant past.
Export-Import Bank - An agency run by the US Federal government that
extends trade credits to US firm’s in order to facilitate US export
financing.
Exposure Draft (ED) - A proposed statement of financial accounting
standards issued by the Financial Accounting Standards Board (FASB) for
public comment.
Exposure Netting - Utilizing a second currency in order to offset
exposure to exchange rate losses or gains.
Expropriation - Seizure of private property by a government.
Expunge - Referring to general equities, to remove from existence.
Extendable Bond - A bond that affords the option to the issuer or lender
for an extension on the maturity.
Extendable Note - A note that affords the option to be extended if
mutually agreed upon by the issuer and the investor.
Extension - Postponement of a payment date.
Extension Date - The date when an option is extended.
Extension Risk - The risk associated with slower than anticipated
repayment of mortgages either because the underlying mortgage pool has
unusual characteristics or because interest rates have remained too high
to stimulate repayment or refinancing.
Extension Swap - Extending a maturity date by selling a note and then
buying another that has a slightly longer current maturity.
External Finance - Finance that is from outside of a company, for
example, a stock issue.
External Market - The Euromarket, a market that is outside of a specific
country.
Extinguish - Pay off or end a debt, the retire a debt.
Extra Or Special Dividends - A dividend that is paid in addition to the
regular or customary dividend.
Extraordinary Income/Loss - Entry on financial statements that refers to
a one-time or non-recurring event such as income from the sale of assets
or losses from a write-off.
Extraordinary Positive Value - Extraordinary Positive Value
Extrapolative Statistical Models - Models that apply formulas and
historical information in order to project results of a future period. |
