|
Parity |
(1) Foreign exchange dealer's slang for your price is the
correct market price. (2) Official rates in terms of SDR
or another pegging currency. |
|
Parities |
The value of one currency in terms of another. |
|
Pip/Point |
The smallest price unit for any foreign currency (e.g. for
USD/CHF one point [or pip] equals .0001 Swiss francs, and
for USD/JPY one point [or pip] equals 0.01 Japanese yen). |
|
Posted Margin |
The part of the margin balance that is posted to Delta
Stock in support of the customer’s open position and
unrealized losses. |
|
Political Risk |
The uncertainty in return on an investment due to the
possibility that a government might take actions that are
detrimental to the investor's interests. |
|
Profit Taking |
The unwinding of a position to realize profits. |
|
Profit/Loss or "P/L" or Gain/Loss |
The actual gain or loss in US dollars resulting from
trading activities on closed positions, plus the
theoretical gain or loss on open positions that have been
marked to market. |
|
Price Transparency |
Describes quotes to which every market participant has
equal access. |
|
Par: |
(1) The nominal value of a security or instrument.(2) The
official value of a currency. |
|
Parallel rate of exchange: |
The unofficial rate of exchange operating in a parallel
market which may or may not be officially condoned. |
|
Paris: |
A term for USDFRF Spot Rate. |
|
Paris Club: |
Informal grouping of governments run by the Bank of France
which meets on an ad hoc basis to seek agreement on
measures to be taken when a country is unable to repay its
foreign government to government borrowings on time. |
|
Parity: |
(1) Foreign exchange dealers' slang for your price is the
correct market price.(2) Official rates in terms of SDR or
other pegging currency. |
|
Parities: |
The value of one currency in terms of another. |
|
Parity Grid: |
A term used in the context of the European Monetary System
which consists of the upper, central and lower
intervention points between member currencies. |
|
Partly Paid: |
In the United Kingdom, the full issue price of a gilt is
often paid in either two or three installments. The
initial payment is made upon application and the remaining
payment(s) is made within a few months. |
|
Payment date: |
The date on which a dividend or bond interest payment is
scheduled to be paid. |
|
Plaza Accord: |
The 1985 Plaza Hotel agreement by the G5 to lower the
dollar. |
|
Pegged: |
A system where a currency moves in line with another
currency, some pegs are strict while others have bands of
movement. |
|
Petrodollars: |
Foreign exchange reserves of oil producing nations arising
from oil sales. |
|
PIBOR: |
Paris Inter-bank Offered Rate. |
|
Pip: |
See point (0.0001 of a unit) |
|
Pit: |
See Ring. |
|
Point: |
(1) 100th part of a per cent, normally 10,000 of any spot
rate. Movement of exchange rates are usually in terms of
points. (2) One percent on an interest rate eg from 8%
-9%. (3) Minimum fluctuation or smallest increment of
price movement. |
|
Portfolio insurance: |
An option hedging strategy to protect long cash market
positions |
|
Position Account: |
See Conversion Account. |
|
Position Clerk: |
A clerk who assist the dealer in recording a dealers
position and ensures that all deal tickets are completed
and transferred to the back office or input into the books
in a position keeping system. |
|
Position limit: |
The maximum position, either net long or net short, in one
future or in all futures of one currency or instrument
combined which may be held or controlled by one person. |
|
Position: |
The netted total commitments in a given currency. A
position can be either flat or square ( no exposure),
long, (more currency bought than sold), or short ( more
currency sold than bought). |
|
Producer Price Indices: |
See wholesale price indices. |
|
Pre-Spot Dates: |
Quoted standard periods that fall between the transaction
date and the current spot value date. See value dates. |
|
Premium: |
(1) The amount by which a forward rate exceeds a spot rate
(2) The amount by which the market price of a bond exceeds
its par value.(3) Options, the price a put or call buyer
must pay to a put or call seller for an option contract.
(4) The margin paid abo |
|
Primary date: |
Issue date, date when payment is received by issuer. |
|
Primary Reserves: |
Gold related monetary reserves, being gold, SDR, etc. |
|
Prime Rate: |
(1) The rate from which lending rates by banks are
calculated in the US. (2) The rate of discount of prime
bank bills in the UK. |
|
Principal: |
A dealer who buys or sells stock for his/her own account. |
|
Profit Graph: |
A graphical representation of the profits to a given
options strategy for different underlying asset prices |
|
Profit Taking: |
The unwinding of a position to realise profits |
|
Proxy Hedge: |
A term to describe when it is necessary to hedge against a
currency where there is no market but it follows a major
currency, the hedge is entered against the major currency. |
|
Purchase fund: |
A type of bond whose issuer may retire up to specified
amounts of the issue in the open market if the price
remains below a certain level. |
|
Put option: |
A put option confers the right but not the obligation to
sell currencies, instruments or futures at the option
exercise price within a predetermined time period. |
|
Put call parity: |
The equilibrium relationship between premiums of call and
put options of the same strike and expiry. |
|
Pyramiding: |
The use of cash generated by positive variation margins on
a futures position to increase the size of the position,
each reinvestment in successively smaller increments |
