|
Leading Indicators |
Statistics that are considered to predict future economic
activity. |
|
Leverage |
The ratio of the amount used in a transaction to the
required security deposit (margin). |
|
Liability |
In terms of foreign exchange, the obligation to deliver to
a counterparty an amount of currency either in respect of
a balance sheet holding at a specified future date or in
respect of an un-matured forward or spot transaction. |
|
LIBOR |
The London Inter-Bank Offered Rate. Banks use LIBOR when
borrowing from another bank. |
|
Limit Order |
An order to buy or sell foreign currency or pairs of
currencies at a specified price or exchange rate. A Limit
Order to buy generally will be executed when the ask price
equals or falls below the price or exchange rate specified
in the Limit Order. A Limit Order to sell generally will
be executed when the bid price equals or exceeds the price
or exchange rate specified in the Limit Order. Customers
should note, however, that market conditions may often
prevent execution of an individual customer’s Limit Order
despite other dealing activity at that price level. |
|
Liquidating Order |
An order to close out one or more open positions. |
|
Liquidity |
The ability of a market to accept large transaction with
minimal to no impact on price stability. |
|
Long Position |
In foreign exchange trading, when the base currency in the
pair is bought, the position is said to be long in that
currency. It is understood that when the base currency in
the pair is "long" the second currency will be "short". |
|
Loss |
Loss incurred as a result of a transaction. |
|
Lot |
A unit to measure the amount of the deal. The value of the
deal always corresponds to an integer number of lots. |
|
Ladder: |
Dealers analysis of the forward book or deposit book
showing every existing deal by maturity date, and the net
position at each future date arising. |
|
Lagging Indicator: |
A measure of economic activity which tends to change after
change has occurred in the overall economy eg. CPI. |
|
Lapsed rights: |
Rights for which call payments have not been made by the
acceptance date. |
|
Last notice day: |
The final day on which notices of intent to deliver on
futures contracts may be issued. |
|
Last trading day: |
The day on which trading ceases for an expiring contract. |
|
Lay off: |
To carry out a transaction in the market to offset a
previous transaction and return to a square position. |
|
LDC: |
Less developed countries, often used with respect to
secondary debt market. |
|
Leading Indicators: |
Statistic that are considered to precede changes in
economic growth rates and total business activity, e.g.
factory orders. |
|
Leads and Lags: |
The effect on foreign trade payments of an anticipated
move in the exchange rate, normally a devaluation. Then
payment of imports is faster and export receipts is slowed
down. |
|
Left-hand side: |
Taking the left hand side of a two way quote i.e. selling
the quoted currency. |
|
Leverage: |
In options terminology, this expresses the
disproportionately large change in the premium in terms of
the relative price movement of the underlying instrument. |
|
Levy: |
An option model |
|
Liability: |
In terms of foreign exchange, the obligation to deliver to
a counterparty an amount of currency either in respect of
a balance sheet holding at a specified future date or in
respect of an un matured forward or spot transaction. |
|
LIBID: |
The London Interbank Bid Rate. The rate charged by one
bank to another for a deposit. |
|
LIBOR: |
The London lnterbank Offered Rate, the rate charged by one
bank to another for lending money. |
|
LIMEAN: |
Calculated from the mean average of LIBOR and LIBID. |
|
Liee: |
French term for a swap. |
|
Life of contract: |
The period between the beginning of trading in a
particular future and the expiration of trading. |
|
LIFFE: |
London International Financial Futures Exchange |
|
LIMEAN: |
The average of the LIBOR and LIBID rates. |
|
Limit down: |
The maximum price decline from the previous trading day's
settlement price permitted in one trading session. |
|
Limit move: |
A price that has advanced or declined the permissible
limit permitted during one trading session. |
|
Limit order: |
An order to buy or sell a specified amount of a security
at a specified price or better. |
|
Limit up: |
The maximum price advance from the previous trading day's
settlement price permitted in one trading session. |
|
Limit: |
When residents of a country are prohibited from buying
other currencies even though non-residents may be
completely free to buy or sell the national currency. |
|
Limited convertibility: |
An arrangement by which a bank agrees to lend to the line
holder during some specified period any amount up to the
full amount of the line. |
|
Lines: |
Any transaction that offsets or closes out a previously
established position. |
|
Liquidation: |
The ability of a market to accept large transactions. |
|
Liquidity: |
A futures trader who normally trades on an exchange on
his/her own account. |
|
Local: |
A market is locked when the bid price equals the asked
price. |
|
Locked market: |
One of the key commercial interest rates normally
referring to Germany although such rates exist in France,
Belgium, and Switzerland. An interest rate for a loan
against the security of pledged paper. |
|
Lombard Rate: |
A forward purchase and sale with a brief uncovered
position between them. This may also be referred to as
long short dates. |
|
Long dated shorts: |
The holding of an excess of a particular currency. |
|
Long: |
The purchase of futures contracts for price protection
purposes, as a defensive position against an increase in
cash prices, or falling interest rates. |
|
Long Hedge: |
An option that permits exercise at any rate that existed
during the option period but only exerciseable after the
option period. |
|
Look Back: |
zz |
|
Look Forward: |
The 1987 agreement between the G5 calling for a halt in
the dollars decline, re-establish balanced trade and non
inflationary growth. |
|
Louvre Accord: |
Luxembourg Inter-bank Offered Rate. |
|
LXBOR: |
|
