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Cable |
Dealers' slang for the sterling/US dollar exchange rate. |
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Cable Transfer |
Telegraphic transfer of funds from one centre to another.
Now synonomous with inter bank electronic fund transfer. |
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Calendar spread |
An option position comprised of purchase and sale of two
option contracts of the same type with different
expiration dates at the same exercise price. |
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Call |
(1) An option that gives the holder the right to buy the
underlying instrument at a specified price during a fixed
period. (2) A period of trading. (3) The right of an bond
issuer to pre pay debt and demand the surrender of its
bonds. |
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Call Dates |
Dates when a call option may be exerciseable. |
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Call Money |
Money lent that is repayable on demand. |
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Call money |
Overnight (GBP) or Federal funds (USD) currency lent by
banks on a very short term basis which can be called the
same day, at one days notice or at two days notice. |
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Call option |
A call option confers the right but not the obligation to
buy stock, shares or futures at a specified price |
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Call Rate |
The overnight interbank interest rate. |
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Callable bond |
A bond that provides the borrower with an option to redeem
the issue before the original maturity date. Usually,
certain terms are set before the issue, such as the date
after which the bond is callable and the price at which
the issuer may retire the bond. The holder of the bond is
usually paid a premium for early termination of the
investment. |
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Cambiste |
French term for foreign exchange dealer. |
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Candlestick Chart |
A chart that indicates the trading range for the day as
well as the opening and closing price. If the open price
is higher than the close price, the rectangle between the
open and close price is shaded. If the close price is
higher than the open price, that area of the chart is not
shaded. |
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Cap |
An agreement with a counterparty that sets an upper limit
to interest rates for the cap buyer for a stated time. |
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Capital Account |
Just a position of the long and short term capital imports
and exports of a country. |
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Capital Adequacy |
Standards set by BIS for banks. |
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Capital market |
The market for medium and long term securities. |
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Capital Movements |
Short and long term claims and liabilities, which are
entered into vis a vis foreign countries, e.g. repayment
of foreign debt, direct investments, portfolio
investments, purchase of private real estate. |
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Capital Risk |
The risk arising from a bank having to pay to the counter
party with out knowing whether the other party will or is
able to meet its side of the bargain. see Herstatt. |
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Carry |
The interest cost of financing securities or other
financial instruments held. |
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Carry |
The interest cost of financing securities or other
financial instruments held. |
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Cash |
Normally refers to an exchange transaction contracted for
settlement on the day the deal is struck. This term is
mainly used in the North American markets and those
countries which rely for foreign exchange services on
these markets because of time zone preference, i.e. Latin
America. In Europe and Asia, cash transactions are often
referred to as value same-day deals. |
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Cash |
Normally refers to an exchange transaction contracted for
settlement on the day the deal is struck. This term is
mainly used in the North American markets and those
countries which rely for foreign exchange services on
these markets because of time zone preference i.e. Latin
America. In Europe and Asia, cash transactions are often
referred to as value same day deals. |
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Cash and Carry |
The buying of an asset today and the selling of a future
contract on the asset. A reverse cash and carry is
possible by selling an asset and buying a future. |
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Cash Delivery |
Same day settlement. |
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Cash Delivery |
The market in the actual financial instrument on which a
futures or options contract is based. |
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Cash Market |
The market for the purchase and sale of physical
currencies. |
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Cash Option |
An option written on an underlying cash instrument rather
than a futures contract. |
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Cash Settled |
The closing out of currency contracts with the exchange of
cash based upon the difference in the value of when the
position was opened and the value of when it is closed,
rather than the delivery of currency. |
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Cash Settlement |
A procedure for settling futures contract where the cash
difference between the future and the market price is paid
instead of physical delivery. |
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CBOE |
Chicago Board Options Exchange |
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CBOT or CBT |
Chicago Board of Trade |
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CD |
Certificate of Deposit. |
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CEDEL |
A computerised system for safe custody, delivery and
settlement for Eurobonds and related securities. Also the
name of an instrument coding system. |
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Central Bank |
A government or quasi-governmental organization that
manages a country’s monetary policy. The US central bank
is the Federal Reserve, and the German central bank is the
Bundesbank. |
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Central Bank |
A bank which is responsible for controlling a countries
monetary policy. It is normally the issuing bank and
controls bank licencing, and any foreign exchange control
regime. |
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Central Rate |
Exchange rates against the ECU adopted for each currency
within the EMS. Currencies have limited movement from the
central rate according to the relevant band. |
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Central Rate |
Exchange rates against the ECU adopted for each currency
within the EMS. Currencies have limited movement from the
central rate according to the relevant band. |
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Certificate of deposit |
A negotiable certificate in bearer form issued by a
commercial bank as evidence of a deposit with that bank
which states the maturity value, maturity rate and
interest rate payable. CDs vary in size with maturities
ranging from a few weeks to several years. CDs may
normally be redeemed before maturity only by sale on the
secondary market but may also be redeemed back to issuing
bank through payment of a penalty. |
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CFTC |
The Commodity Futures Trading Commission, the US Federal
regulatory agency for futures traded on commodity markets,
including financial futures. |
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CHAPS |
Clearing House Automated Payment System. |
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Chartist |
An individual who uses charts and graphs and interprets
historical data to find trends and predict future
movements. Also referred to as Technical Trader. |
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Chartist |
An individual who studies graphs and charts of historic
data to find trends and predict trend reversals which
include the observance of certain patterns and
characteristics of the charts to derive resistance levels,
head and shoulders patterns, and double bottom or double
top patterns which are thought to indicate trend
reversals. |
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CHIPS |
The New York clearing house clearing system. (Clearing
House Interbank Payment System) .Most Euro transactions
are cleared and settled through this system. |
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CIBOR |
Copenhagen Interbank Rate, the rate at which the banks
lend the Danish Krone on an unsecured basis. The rate is
calculated daily by the Danmarks Nationalbank (the Danish
Central Bank), based on rules set out by the Danish
Banker's Association. |
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Circuit breaker |
Price change limits and trading halts intended to reduce
excessive price fluctuations.Clean float: |
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Clean |
The price of a bond not including the accrued interest
element. |
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Clean float |
An exchange rate that is not materially affected by
official intervention. |
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Clean price |
An exchange rate that is not materially effected by
official intervention. |
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Clear Day |
In the UK capital market refers to a price quoted
excluding accrued interest. |
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Cleared Funds |
Funds unencumbered and freely available sent in to settle
a trade. |
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Clearing |
The process of settling a trade. |
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Clearing |
The process of setting a number of items against one
another and making fund transfers on the net balance only
as part of the settlement process. |
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Clearing house |
An organisation established to facilitate the transfer of
ownership of securities. An exchange-associated, usually
independent organization through which all contracts are
made, offset and delivered eg. ICCH. |
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Clearing member |
A member firm of a clearing house. |
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Client agreement |
The process of matching, registering and guaranteeing
transactions. |
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Close |
The end of the business day e.g. London 4.30 p.m. |
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Closed book period |
A period of time, usually two or three weeks, before each
coupon due date. The coupon is paid to the person holding
the bond prior to the closed-book period. If this person
sells the bond during this period, he must compensate the
buyer for any accrued interest. |
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Closed Position |
Exposures in foreign currencies that no longer exist. The
process of closing a position is the selling or buying of
a certain amount of currency to offset an equal amount of
open positions. This will "square" the open position. |
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Closed position |
A transaction which leaves the trade with a zero net
commitment to the market with respect to a particular
currency. |
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Closing purchase transaction |
The purchase of an option identical to one already sold to
liquidate a position. |
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CME |
Chicago Merchantile Exchange |
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Cock Dates |
see broken dates. |
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Coincident Indicator |
An economic indicator that generally moves in line with
the general business cycle such as industrial production. |
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Collar |
A combination of a cap and a floor. A collar sets a band
within which interest rates will apply (e.g. 10%-13.75%),
for a given period. |
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Collateral |
AnAn asset pledged as security to ensure payment or
performance of an obligation. |
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Comex |
Commodity Exchange of New York. |
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Commercial Paper |
Promissory notes usually with up to 270 day maturity, sold
by companies or institutions for working capital. Widely
used in the US. |
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Commission |
The fee levied by an institution to undertake a trade. |
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Commission |
The fee that a broker may charge clients for dealing on
their behalf. |
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Compound Option |
An option on an option, the dates and price of such option
being fixed. |
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Comptant |
French term for spot settlement in foreign exchange. |
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Comptroller of the Currency |
US Treasury Department official with the primary role in
bank supervision. |
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Confirmation |
A notification sent by a dealer to the customer describing
the terms of a trade. |
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Confirmation |
A memorandum to the other party describing all the
relevant details of the transaction. |
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Consumer Price Index |
Monthly measure of the change in the prices of a defined
basket of consumer goods including food, clothing, and
transport. Countries vary in their approach to rents, and
mortgages. |
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Contagion |
The tendency of an economic crisis to spread from one
market to another. In 1997, political instability in
Indonesia caused high volatility in their domestic
currency, the Rupiah. From there, the contagion spread to
other Asian emerging currencies, and then to Latin
America, and is now referred to as the "Asian Contagion." |
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Contango |
A condition in a futures market where the more distant
delivery months trade at a premium to the term delivery
months. |
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Contract |
An Over-the-Counter (OTC) agreement between Delta Stock
and the customer to buy or sell currency. |
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Contract |
An agreement to buy or sell a specified amount of a
particular currency or option for a specified month in the
future. See Futures contract. |
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Contract expiration date |
The date on which a currency must be delivered to fulfill
the terns of the contract. For options, the last day on
which the option holder can exercise his right to buy or
sell the underlying instrument or currency. |
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Contract month |
The month in which a futures contract matures or becomes
deliverable if not liquidated or traded out before the
date specified. |
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Contract of differences |
A futures contract which is settled by a cash payment
reflecting the monetary difference between the initial
transaction price and the price of the underlying asset on
expiry. |
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Convergence |
The process by which the futures price moves towards and
ultimately equals the price of the underlying instrument
at expiration. |
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Conversion |
The process by which an asset or liability denominated in
one currency is exchanged for an asset or liability
denominated in another currency. |
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Conversion Account |
A general ledger account representing the uncovered
position in a particular currency. Such accounts are
referred to as position accounts. |
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Conversion Account |
A general ledger account representing the uncovered
position in a particular currency. Such accounts are
referred to as Position Accounts. |
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Conversion arbitrage |
A transaction where the asset is purchased and buys a put
option and sells a call option on the asset purchased,
each option having the same excise price and expiry. |
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Conversion premium |
The amount by which the price of a convertible bond
exceeds the market price of the underlying stock. |
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Convertible Currency |
Currency which can be freely exchanged for other
currencies or gold without special authorization from the
appropriate central bank. Copey - slang for the Danish
krone. |
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Counter Currency |
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