Word English Romanian French Spanish

Abnormal The difference between the return on a

return stock (or entire portfolio) and the
performance of an index, such as the
S&P 500. The abnormal return is equal
to the market return - the normal return.
For example, a stock that provided a
return of 10% over the same period of
time in which an index provided a 6%
return would have an abnormal return of
10% - 6% = 4%. If the abnormal return
is negative then it has underperformed
the index.
Above par A share or a bond whose market value is 1. “supra pari”, Au dessus du Por encima de la
higher than its nominal value or face peste pair par, por encima
value. For example, if long-term interest paritatea/valoarea de su valor
rates decrease after the issue of the nominală(a nominal, por
bond, the bond's price will increase acţiunii); encima de la
above par. Opposite: Below par 2. preţ peste paridad.
nominal.
Acceptance A time draft (or bill of Exchange) on 1. acceptare (a Acceptation Aceptación
which the drawee has written the word ofertei),accept,
"accepted" over his signature, thereby aprobare, primire;
becoming unconditionally obliged to 2. acceptabilitate,
pay at maturity. The draft must first be potrivire,
presented for acceptance, by which the character
drawee becomes the "acceptor", and convenabil (al
then for payment. mărfii);
(1) Bank(er's) Acceptance: a draft of 3. trată, poliţă;
which a bank is both drawee and 4. accept (cambie
acceptor; i.e. the bank gives its acceptată/andosată
guarantee to make the payment should de o bancă),
the buyer default. acceptare (a
(2) Trade acceptance: a draft, usually cambiei);
issued from the sales of merchandise, 5. recepţionare,
whose drawee and acceptor is an acceptare (a
individual or a business entity. produselor);
6. (transp.)
formulă de
justificare (care
scuteşte furnizorul
de răspundere în
caz de depăşire a
termenului stabilit
de transportare).
Acceptance Short-term loan by which the bank Credit prin Crédit Crédito de
credit allows the customer to draw bills on it acceptare, accept. d’acceptation aceptación
up to a certain amount (line of credit).
The bills are then accepted and usually
also discounted by the bank. Most
frequently used in international trade.
Acceptance In the underwriting business, the price Prix Precio de
price paid by the banks to the issuers for d’acceptation aceptación
underwriting a new securities' issue. The
acceptance price is lower than the issue
price to the general public, the
difference being the banks' gross profit
margin or commission.
Account party The party which addresses the bank for Partie Parte solicitante
the issue of a letter of credit, e.g. the comptable
account party can be an importer, a
buyer, a construction contractor or a
supplier bidding on a contract.
Accounts Money due to suppliers. Also called Dettes passives Cuentas a pagar
payable payables and trade payables.
Accounts Money due from customers. Also called Dettes actives Cuentas a
receivable receivables and trade receivables. cobrar, activo
corriente, activo
exigible, efectos
a cobrar, valores
exigibles.
Accrual An accounting method where revenues Comptabilité Contabilidad de
accounting are recognized when earned and cumulative valores
expenses when incurred, regardless of devengados.
the actual timing of the cash receipts
and expenditures. Compare with cash
accounting.
Accrued (1) Interest earned but not collected. Intérêts courus Intéres
interest (2) Interest earned, but still unpaid, acumulado,
since the latest payment date. intéres
(3) Interest due from the date of issue or devengado,
the last coupon date on an interest- intéres vencido
bearing security, or from the last date of
payment on a loan.
Accrued Accounting items entered on the Passifs Pasivo
liabilities liabilities side of the balance sheet transitoires acumulado
which relate to previous operations;
such as income received during the past
financial year but which relates to the
new fiscal year, or expenses incurred
during the past year but not payable
until the following year.
Acid test / A liquidity ratio measuring a company's Ratio de Prueba ácida
Quick ratio ability to pay immediate liabilities. It is liquidité
expressed as: current assets less
inventories, divided by current
liabilities. Compare with Quick ratio.
Active income Income resulting from the active Revenu actif Ingreso activo
conduct of trade or business.
Actual(s) The physical commodity or security Physique(s) Actual(s)
underlying a futures contract. It may
also be designated "cash" or
"physicals".
Ad Valorem Any charge, tax, or duty (tariff) Droits Ad Derecho Ad
Duty calculated and applied as a percentage Valorem (en Valorem
(According to of the value (price) of the item. The function de la
value) higher the value of an item, the higher valeur)
the ad valorem duty.
Addendum A supplement or appendix attached to a Addendum Suplemento
document (such as a bill of exchange)
which can be used for endorsement.
Advance A loan, usually short-term (i.e. one to Avance Préstamo,
three years), taking the form of an anticipo,
overdraft to a company or individual. adelanto
Advance A loan secured by the documents Avance contre Préstamo contre
against covering the shipments, which remain in documents documentos,
documents control of the creditor. Adelanto sobre
(A/D) documentos
Advance import A foreign exchange control technique Avances Depósitos
deposits whereby importers are required to relatives aux previos a la
deposit a percentage of the value of a depots importación
product with the designated authorities d’importation
for a specified period of time.
Advanced (1) A bond provided by a supplier to a Obligation, Bono de pago
Payment buyer to assure him that advance garantie de anticipado,
Bond/Guarantee payments made to the supplier will be paiement garantía de pago
returned if the contractual obligations anticipé anticipado
are not fulfilled. The bond is issued up
to the amount of the advance payments
specified in the contract. The value of
the bond normally decreases as the
supplier fulfils the obligations for which
the advance payments were made. Such
bond may be either conditional or
unconditional.
(2) An arrangement whereby a company
employing a contractor makes funds
available to him to purchase equipment
 and to cover the organizational expenses
involved in getting the construction
under way.
Advised letter A commercial letter of credit whose Lettre de credit Carta de crédito
of credit authenticity has been verified by a bank, notifiée notificada
usually located in the beneficiary's
country. The bank then advises the
beneficiary of the authenticity of the
letter of credit, without however
undertaking any payment obligation.
Advising bank Also known as the notifying bank. This Banque Banco
is the bank operating in the exporter's notificatrice notificador
country which handles letter of credit on
behalf of the foreign bank, by notifying
the exporter that the credit has been
opened in his favour and informing him
of the terms and conditions of the letter
of credit. It does not necessarily have
responsibility for payment.
Advisory A term designating the fact that the Capacité Calidad de
Capacity powers of a shipper's agent or notificatrice asesor
representative abroad are limited, and
that he is not authorized to take
decisions or make adjustments without
previously referring to his principals.
Compare with without reserve.
After date A phrase indicating that payments on a Après la date Plazo fecha
draft or other negotiable instrument are
due on a specific date after the
presentation of the draft to the drawee.
Compare with after sight, at sight.
After sight This expression is written on a draft or Après Plazo vista
other negotiable instrument, meaning présentation
that it becomes payable on a certain date
after having been presented for
acceptance (e.g. 90 days). The period
starts the date the bill is signed and
accepted by the drawee. In order to let
the holder of the bill know when the bill
becomes payable, the drawee must add
the date of his acceptance.
After-tax cash The total cash generated by an Flux de Flujo de caja
flow investment annually. This is defined as trésorerie après después de
profit after-tax plus depreciation, or impôts impuestos
operating income after tax plus the tax
rate time’s depreciation.
After-tax real This is defined as the after-tax rate of Taux de Tasa de
rate of return return on an investment minus the rentabilité reel rendimiento real
inflation rate après impôts después de
impuestos, tasa
de rentabilidad
real después de
impuestos
African Established in 1963, with its Banque Banco africano
Development headquarters in Abidjan, Côte d'Ivoire. Africaine de de desarrollo
Bank The ADB provides financing through Développement
direct loans to African member states to
cover the foreign exchange costs
incurred in bank-approved development
projects in these countries. Fifty-one
African countries are members. The
ADB is financed by member countries
of the OECD.
African An independent, non-profit government Fondation Fundación
Development corporation established to provide Africaine de Africana para el
Foundation financial assistance to grass-roots Développement desarrollo, FAD
(ADF) organizations in Africa. The ADF
became operational in 1984.
Agency fee An annual fee payable by the borrower, Honoraires, Comisión de
(management usually to cover the costs incurred by commission agente,
fee) the lender in administering the loan. d’agence, Comisión de
administración,
Comisión de
gestión
Agency for Created in 1961 to administer foreign Agence pour le Agencia para el
International economic assistance programmes of the Développement Desarrollo
Development US government. AID has field missions International Internacional
(AID) and representatives in approximately 70
developing countries in Africa, Latin
America, the Caribbean and the Near
East.
Agency shop Provision in a collective bargaining
clause agreement that all employees of the firm
(whether or not members of the union)
pay a fixed monthly sum to the union as
a condition of employment. This
arrangement (where it is legal) serves as
a compromise between the union's
objective to eliminate free riders, and
management's objective to make union
membership a voluntary decision of
each employee.
Agent A legally independent person, Agent Agente,
authorized by another person (the representante,
principal) to act on his behalf as an mandatario
intermediary or to conclude business
transactions. The agent usually receives
a fee or a commission (often a
percentage of the sale price) for the
services rendered. In a syndicated loan,
the agent is the bank which manages the
loan on behalf of the participating
banks.
Agent A fee-based service providing U.S. Agent Servicio de
distributor exporters with a customized overseas distributeur de agente
service (ADS) search for interested and qualified services distribuidor
foreign representatives (such as foreign
import agents and distributors).
Agio A security sells at agio when its market Agio, prime Agio
value is higher than its nominal or par
value. In foreign exchange operations
this is the premium paid to exchange
one currency for another. Opposite:
Disagio.
Agreed Minute This embodies the terms agreed upon in Procès verbal Acta aprobada
a Paris Club rescheduling meeting. It convenu
forms the basis for bilateral discussions
between individual creditor
governments (including export credit
agencies) and debtor countries on
agreements for implementation of the
rescheduling. The Minute normally
specifies the coverage of debt-service
payments to be consolidated, the cut-off
date, the consolidation period, the
proportion to be rescheduled and the
deferred debt.
Air waybill A bill of lading used for the Lettre de Carta de porte
transportation of air freight, describing voiture aéreo
conditions, liability, shipping aérienne
instructions, nature of the commodity
and applicable transportation charges. It
is a non-negotiable instrument of air
transport acting as a receipt for the
shipper, and indicating that the carrier
has accepted the goods listed therein
and is thereby committed to carry the
consignment to the airport of
 destination, according to the specified
conditions.
All-in cost Total costs, whether foreseeable or not. Tout-inclu dans Costo todo
le coût incluido
All-in rate The interest rate on a loan which Tout-inclu dans Tasa todo
includes the cost of Compensating le taux incluido
balances, Commitment fees and any
other charges.
Allonge A slip of paper attached to a bill of Allonge Allonge
Exchange , acceptance or notes,
providing space for additional
endorsement when the back of the bill is
already filled with names.
All Risks A clause used in marine insurance, Couverture de Cobretura contra
Coverage providing the shipment with the tous les risques todo riesgo
broadest kind of standard coverage. It
excludes, however, damage to the
shipment caused by war, strikes and
riots. Compare with the Free of
Particular Average and With Average
clauses.
Alongside A term referring to the side of a ship. Le long Al costado
Goods to be delivered alongside are to
be placed on the dock or within reach of
the transport ship's tackle so that they
can be loaded on board. Goods are
delivered alongside at the port of
embarkation, excluding loading fees.
Alpha A Yield indicator based on the risk of a Alpha Alfa
security or a portfolio in relation to the
market risk. A positive Alpha indicates
the extra yield of the security or
portfolio awarded to the investor for
having taken a risk, rather than simply
accepting the average markets return.
Thus, an alpha of 0.5 means that the
security or portfolio has outperformed
the estimated market-based return by
0.5%.
American Domestically traded securities Certificats de Recibo
Depository representing claims of foreign stocks. dépót Americano de
Receipts américains depósito
(ADRs)
American An option which can be exercised at any Option Opción
option time between the date of purchase and américaine estadounidense
its expiry date.
 An option which can be exercised at any
time between the purchase date and the
expiration date. Most options in the U.S.
are of this type. This is the opposite of a
European-style option, which can only
be exercised on the date of expiration.
Since an American option provides an
investor with a greater degree of
flexibility than a European style option,
the premium for an American style
option is at least equal to or higher than
the premium for a European-style
option which otherwise has all the same
features. Also called American-style
option.(Investorwords.com)
Amortization 1) The gradual reduction of a debt, Amortissement Amortización
through regular repayments of principal
instalments and payment of current
interest over an agreed period of time,
so as to liquidate the debt.
(2) In accounting, a term indicating the
systematic writing off of an account or
asset over its estimated life.
Andean Group A group of Latin American countries Groupe andéen Grupo Andino
formed in 1969 to promote regional
economic integration among medium-
sized countries. Its member states
include Bolivia, Colombia, Ecuador,
Peru and Venezuela.
Annuity A stream of annual cash flows for a Annuité Renta anual,
specified period of time. anualidad
Antidumping A set of laws and practices intended to Antidumping Antidumping
counteract dumping practices.
A/P (Authority An authorization, usually by a bank to a Autorisation à Autoridad para
to pay) seller, for the purchase, with or without payer pagar
recourse, of draft(s), document(s) and/or
goods up to a designated amount.
Application for A written request by an applicant (an Demande de Solicitud de
letter of credit importer or purchaser) to his bank to lettre de crédit carta de crédito
open a letter of credit. The notification
of the opening of the letter of credit is
usually done via a correspondent bank.
Arbitrage The purchase of financial instruments Arbitrage Arbitraje
(e.g. foreign exchange or securities) or
commodities on one market with the
 intention of selling them simultaneously
on another market to take advantage of
the price differential between the two
markets. The arbitrageur (the person
carrying on the business of arbitrage)
may earn a profit by exploiting the
differences in the rates of exchange or
the prices of securities or commodities
involved. Arbitrage is attractive only if
the price difference is large enough to
cover the costs incurred (such as the
costs of transporting the goods from one
market to the other).
Arrangement Fee charged by a commercial bank Honoraire Comisión de
Fee which assists in arranging complex d’arrangement acuerdo
forms of financing, including export
credit insurance. Sometimes called a
Management Fee.
Arrears Generally speaking, debt-service Arriérés Mora, atrasos
payments not made by the due date. In
the specific field of export credits,
arrears are overdue payments by
borrowers, which have not yet resulted
in claims against the export credit
agencies.
Asian Established in 1966 to foster economic Banque Banco Asiático
Development growth and co-operation in Asia and to Asiatique de de desarrollo
Bank (ADB) help accelerate the economic développement
development of members. The ADB
headquarters are in the Philippines.
Asked/ask price The price at which securities (including Cours vendeur Precio de
foreign exchange or foreign bank notes) vendedeur,
are offered for sale. Opposite: Bid. precio de oferta,
precio nominal
Asset-backed A security issued by a financial Titre garanti Título con
security institution and backed by an asset (e.g. a par des actifs activos en
commodity). garantía
Asset/equity The ratio of total assets to stockholder’s Ratio actifs sur Rélacion entre
ratio equity. fonds propres activos y
beneficios
Asset turnover A measure of asset efficiency, defined Ratio actifs/ Razón de
ratio as net sales divided by total assets. Chiffre rotación de
d’affaires activos
Assets A term indicating everything a company Actifs Activos
owns which has a monetary value listed
on the balance sheet (cash funds, credit
 balances, supplies, equipment and
facilities, etc.). Assets can be financial
assets (such as bills), fixed assets
(equipment) and intangible assets
(goodwill, patent). Opposite: liabilities.
Assignee The acquirer of a title, interest or Cessionnaire Cesionario
ownership transferred by an assignor.
Assignment The transfer of the legal right, interest or Cession Cesión, traspaso,
ownership (title) from a creditor transferencia
(assignor) to a new creditor (assignee).
A distinction is made between a single
assignment (where only a specific claim
is assigned) and a blanket assignment
where all receivables are assigned. In
the case of an option, an assignment is
made when the option writer (seller)
receives an exercise notice obliging him
to sell (in the case of a call) or to buy (in
the case of a put) the underlying
security at the specified strike price.
Assignment A credit granted against the fiduciary Crédit contre Crédito cedido
credit assignment of one or several receivables cession
to a bank. The accounts receivable act
as a security for lending.
Assignor The person who transfers the title, Cédant Cedente
interest or ownership to a third party.
Association of The Association of International Bond AIBD AIBD
International Dealers, setting market trading rules for (Association (Asociación de
Bond Dealers the secondary market of Eurobonds. Internationale Agents
(IBD) des Courtiers Internacionales
en Obligations) de Bolsa)
At best A buying or selling order by a customer Au mieux Por lo mejor
to a broker, to buy or sell a certain
security at the best currently available
price. In the case of a buying order it is
therefore "at the lowest possible price",
and "at the highest possible price" in the
case of selling order. The buyer or seller
does not have to specify any maximum
or minimum price for the execution of
the order by the broker.
At call Money deposited by a bank or at a bank, Sur demande A la vista
without any fixed maturity date. The
money may be withdrawn at any time
when the depositor "calls" for it.
At par A term meaning the "same value", Au pair At par
 implying that the price of the security is
equal to its face value. Securities are
issued at par, par price, par rate.
At sight A term indicating that payment on a Á vue A la vista
draft or other negotiable instrument is
due upon presentation or demand.
At-the-money An option with an exercise price equal Á l’option Opción a la par
option to, or close to, the current market price monétaire
of the underlying security.
Authorized A bank allowed by a country’s public Banque Banco
bank authorities to process the decentralized autorisée autorizado,
payment transfers. banca delegada
Authorized Maximum value of securities that a firm
share capital can legally issue. This number is
specified in the memorandum of
association (or articles of incorporation
in the US) when a firm is incorporated,
but can be changed later with
shareholders' approval. Authorized
share capital may be divided into (1)
Issued capital: par value of the shares
actually issued. (2) Paid up capital:
money received from the shareholders
in exchange for shares. (3) Uncalled
capital: money remaining unpaid by the
shareholders for the shares they have
bought. Also called authorized capital,
authorized stock, nominal capital,
nominal share capital, or registered
capital.
Aval A form of guarantee, generally given by Aval Aval
a commercial bank, on a negotiable
instrument. An aval is usually an
unconditional guarantee of payment and
is not affected by the terms of the
underlying transaction. Avals are
recognized only in certain countries
(mainly European), though usually not
in countries with an Anglo-Saxon legal
base.
Average The number of days required, on Date Fecha promedio
collection average, to collect accounts receivable. d’échéance de vencimiento
period moyenne
Average Life The sum of the amounts outstanding of Vie moyenne Vida media
the loan at the end of each year,
throughout its entire life, divided by the
 total principal sum borrowed. It gives
the average life of the loan in years.
Average The number of days, on average, in Période de Período medio
payment period which a firm pays off its accounts paiement de pago
payable. moyenne
Average rate of The ratio of average net earnings to Taux moyen de Tasa de
return (ARR) average investment. rentabilité rentabilidad
media
Average term In relation to a bond issue, the maturity Durée Plazo promedio
calculated on the date halfway between moyenne
the earliest and the latest date stipulated
for repayment.
Back bond A Eurobond created by the exercise of a Back bond Bono
warrant. Also known as a virgin bond. garantizado
Back-to-Back A letter of credit issued for the account Lettre de crédit Carta de crédito
Letter of Credit of a buyer of merchandise already "Back-to- garantizada
holding a letter of credit in his favor. Back"
The back-to-back L/C is issued in favor
of the supplier of the merchandise to
cover the shipment stipulated in the L/C
already held by the buyer. The terms of
L/Cs, except for the amount and
expiration date, are similar, and the
same documents presented under the
"back to back" L/C are subsequently
used against the L/C in favor of the
buyer. However, the buyer or
beneficiary of the first credit, substitutes
his draft and invoice for those presented
by the supplier.
Back to back A loan in which two companies in Prêt "Back to Préstamo
loan different countries borrow each other's back" cruzado en
currency for a specific time period, with divisas, crédito
repayment of the other's currency at an con garantía de
agreed maturity. This technique allows otro crédito
companies to eliminate or reduce their
foreign exchange risks. Also known as a
Parallel loan.
Backwardation A term indicating that futures prices of a Déport Mercado
commodity are lower than spot prices. If invertido
a commodity moves into backwardation
the markets expect prices to fall.
Opposite: Contango.
Bad debt A non-performing loan i.e. a loan which Mauvaise dette, Deuda
is not repaid. To absorb losses arising dette incobrable,
from bad debts over a period of time, irrécouvrable deuda morosa,
 banks usually set aside provision out of crédito fallido
their profits.
Balance An accounting term indicating the Solde Saldo, balance,
difference between the total of all credit balanza
items and that of all debit items.
Balance of
payments

Buy in A securities-related term referring to a

situation in which an investor must
repurchase shares of stock because the
seller either failed to deliver the shares
or did not deliver them in a timely
fashion. The buyer notifies exchange
officials, who in turn notify the seller of
the delivery failure. The exchange
assists the buyer in purchasing the stock
again, with the original seller having to
make up the price difference if the new
shares are more expensive than
originally agreed to.

Cash forward A cash market transaction in which a

contract seller agrees to deliver a specific cash
commodity to a buyer at some point in
the future. Unlike futures contracts
(which occur through a clearing firm),
cash forward contracts are privately
negotiated and are not standardized.
Further, the two parties must bear each
other's credit risk, which is not the case
with a futures contract. Also, since the
contracts are not exchange traded, there
is no marking to market requirement,
which allows a buyer to avoid almost all
capital outflow initially (though some
counterparties might set collateral
requirements). Given the lack of
standardization in these contracts, there
is very little scope for a secondary
market in forwards. The price specified
in a cash forward contract for a specific
commodity. The forward price makes
 the forward contract have no value
when the contract is written. However,
if the value of the underlying
commodity changes, the value of the
forward contract becomes positive or
negative, depending on the position
held. Forwards are priced in a manner
similar to futures. Like in the case of a
futures contract, the first step in pricing
a forward is to add the spot price to the
cost of carry (interest forgone,
convenience yield, storage costs and
interest/dividend received on the
underlying). Unlike a futures contract
though, the price may also include a
premium for counterparty credit risk,
and the fact that there is not daily
marking to market process to minimize
default risk. If there is no allowance for
these credit risks, then the forward price
will equal the futures price. also called
forward contract.

Chargeback Definition 1
Accounting: Allocation of costs and
resource usage based on actual usage or
a predetermined amount. See also
chargeout.
Definition 2
Electronic commerce: Withdrawal by
the credit card issuer of the amount
credited to the merchant's account (plus
a chargeback fee) when a card-holder
disputes a transaction charged on his or
her card. The merchant usually has 10
days to submit proof of purchase and
proof of delivery to reclaim the charged
back amount.
Commodity A physical substance, such as food,
grains, and metals, which is
interchangeable with another product of
the same type, and which investors buy
or sell, usually through futures
contracts. The price of the commodity is
subject to supply and demand. Risk is
actually the reason exchange trading of
 the basic agricultural products began.
For example, a farmer risks the cost of
producing a product ready for market at
sometime in the future because he
doesn't know what the selling price will
be.
More generally, a product which trades
on a commodity exchange; this would
also include foreign currencies and
financial instruments and indexes.
Default rate The rate at which debt holders default
on the amount of money that they owe.
It is often used by credit card companies
when setting interest rates, but also
refers to the rate at which corporations
default on their loans. Default rates tend
to rise during economic downturns,
since investors and businesses see a
decline in income and sales while still
required to pay off the same amount of
debt.
Direct transfer The movement of tax-deferred
retirement assets from one plan or
custodian directly to another. A direct
transfer is not a withdrawal and does not
incur any taxes or penalties. This allows
a person to move his/her retirement
assets as many times as he/she wants to
plans or custodians that might be more
suitable for him/her at that point in time.
Disposable Gross income of an individual or firm
income from which direct taxes (such as PAYE,
income tax) have been deducted. When
essential expenditure (such as on food,
clothing, shelter) is deducted from the
disposable income, the balance is called
discretionary income which the income
earner is free to spend or save.
Dividend The amount of cash that a company
payout sends to its shareholders in the form of
dividends. The company can decide to
send all profits back to its investors, or
could keep a portion of it as retained
earnings.
Earnings per Net income of a firm divided by the
share (EPS) number of its outstanding shares the
 shares held by the stockholders
(shareholders). Primary earnings per
share (also called fully diluted EPS)
takes into account all shares currently
outstanding, plus the number of shares
that would be outstanding if all
convertible bonds and convertible
preferred stock (preference shares) were
exchanged for common stock (ordinary
shares). Also called net income per
share. Formula: (Total revenue - Total
expenses) ÷ Number of outstanding
shares.

Equity Ownership interest in a corporation in

the form of common stock or preferred
stock. It also refers to total assets minus
total liabilities, in which case it is also
referred to as shareholder's equity or net
worth or book value. In real estate, it is
the difference between what a property
is worth and what the owner owes
against that property (i.e. the difference
between the house value and the
remaining mortgage or loan payments
on a house). In the context of a futures
trading account, it is the value of the
securities in the account, assuming that
the account is liquidated at the going
price. In the context of a brokerage
account, it is the net value of the
account, i.e. the value of securities in
the account less any margin
requirements.
Ex-stock A security which no longer carries the
dividends right to the most recently declared
dividend; or the period of time between
the announcement of the dividend and
the payment. A security becomes ex-
stock dividend on the ex-dividend date
(set by the NASD), which is usually two
business days before the record date (set
by the company issuing the dividend).
For transactions during the ex-stock
 dividend period, the seller, not the
buyer, will receive the dividend. Ex-
dividend is usually indicated in
newspapers with an x next to the stock
or mutual fund's name. In general, a
stock's price drops the day the ex-stock
dividend period starts, since the buyer
will not receive the benefit of the
dividend payout till the next dividend
date. As the stock gets closer to the next
dividend date, the price may gradually
rise in anticipation of the dividend. Also
called ex-dividend.

Exposure Definition 1
General: State or condition of being
unprotected and open to damage,
danger, risk of suffering a loss in a
transaction, or uncertainty.
Definition 2
Advertising: Degree to which an
audience (readers, listeners, viewers and
visitors to a website) is in receipt of a
promotional message.
Definition 3
Banking: (1) Total amount of unsecured
loans; (2) Total amount of loans
advanced to a single borrower, group,
industry, or country; (3) probability of
loss from devaluation, revaluation, or
foreign exchange fluctuations.
Face amount Definition 1
Banking: (1) Amount written on a check
the sum its payee is entitled to draw. (2)
Principal sum advanced under a loan or
mortgage agreement.
Definition 2
Insurance: Sum of money for which an
insurance cover is obtained, usually
shown on the top sheet (face) of the
policy. In life insurance, face amount is
the sum paid on the policy's maturity
date, on the death of the insured, or (if
the policy terms permit) on his or her
 total disability.
Global Negotiable certificate issued by one
depository country's bank against a certain number
receipt (GDR) of shares held in its custody but traded
on the stock exchange of another
country. GDRs entitle the shareholders
to all associated dividends and capital
gains, and can be bought and sold like
other securities. Thus they allow
investors in any country to buy shares of
any other country without losing the
income or trading flexibility. Also
called European depository receipt
(EDR) or international depository
receipt (IDR).
HACCP Hazard analysis and critical control
point. Food production, storage, and
distribution monitoring system for
identification and control of associated
health hazards. It is aimed at prevention
of contamination, instead of end-
product evaluation. In place of relying
on food inspectors to detect food safety
problems, HACCP shifts the
responsibility to the food producer to
ensure that the product is safely
consumable. Proposed by the Codex
Alimentarius Commission for the food
industry in general, and meat, poultry,
and seafood industry in particular, it has
been adopted by some 150 countries.
See also HACCP process, and seven
principles of HACCP.
Indirect A way of investing in real estate without
investment actually investing in the property.
Indirect investment can be done in many
ways, including securities, funds, or
private equity. Most investors interested
in indirect investment would do so
through a company or advisor who has
experience in this type of investing.
Insurance A company that offers insurance
company policies to the public, either by selling
directly to an individual or through
another source such as an employee's
benefit plan. An insurance company is
 usually comprised of multiple insurance
agents. An insurance company can
specialize in one type of insurance, such
as life insurance, health insurance, or
auto insurance, or offer multiple types
of insurance.
Irrevocable Firm commitment by an issuing bank to
letter of credit pay an accepting bank a specified sum
in a specified currency, provided the
conditions included in the L/C
document are met within a specified
timeframe. This L/C cannot be canceled
(or its terms amended) without the
seller's (beneficiary's) prior written
approval, and comes usually as a
confirmed irrevocable letter of credit.
Job description Broad, general, and written statement of
a specific job, based on the findings of a
job analysis. It generally includes
duties, purpose, responsibilities, scope,
and working conditions of a job along
with the job's title, and the name or
designation of the person to whom the
employee reports. Job description
usually forms the basis of job
specification.
Key KPI. A set of measures that help a
performance company determine if it is reaching its
indicators performance and operational goals.
Indicators can be both financial and
non-financial, and there is no one set of
indicators used by all companies. An
example of a financial indicator is same
store sales for a retail clothing chain,
while an example of a non-financial
indicator is the benefits created by
hiring new executives.

Liquidity risk Probability of loss arising from a

situation where (1) there will not be
enough cash and/or cash equivalents to
meet the needs of depositors and
borrowers, (2) sale of illiquid assets will
yield less than their fair value, or (3)
illiquid assets will not be sold at the
desired time due to lack of buyers.
Monetary A government's stockpile of foreign
reserve currency and precious metals. Monetary
reserves are useful both for settling
transactions involving foreign
counterparties and for undertaking
trading in foreign exchange and
commodity markets. In general, the
larger the monetary reserve, the better
the country is able to engage in
transactions with foreign countries.
Options OCC. The organization that handles
clearing clearing of the options trades for the
corporation various options exchanges and regulates
the listing of new options. It is regulated
by the Securities and Exchange
Commission, and is owned jointly by
the U.S. stock exchanges that trade
options (American Stock Exchange,
Chicago Board Options Exchange,
Pacific Exchange, and Philadelphia
Stock Exchange). The fact that all listed
options are cleared through OCC means
that all options are free of default risk,
since the OCC guarantees all option
contracts. Therefore, the buyer or a
seller of an option only faces the credit
risk of the OCC (which is minimal), not
the credit risk of the counterparty. In
order to manage risk, the OCC imposes
margin requirements on all options
brokers. The margin requirement
depends on the particulars of each
specific contract.
Permanent life An umbrella term for a variety of plans
insurance that combine a death benefit similar to a
term life insurance plan with tax-
sheltered savings arrangements.
Permanent life policies, as their name
implies, are meant to be held and paid
into for the duration of the insured's life.
Because of this, there are significant
fees associated with setting up the
policy. Despite these fees, the tax
advantages can make permanent life a
valuable investment over a long period
of time. Also called cash value
 insurance.
Price fixing Collusion among competitors to (1) sell
a good or commodity at the same price,
(2) use the same formulas for computing
selling prices, (3) offer the same
discounts, (4) keep the same price
differentials between different order
quantities, qualities, or types, and (5)
not lower the prices without notifying
other colluders. Also called price
manipulation, it is a criminal offense.
Request for Document used in soliciting price and
quotations delivery quotations that meet minimum
(RFQ) quality specifications for a specific
quantity of specific goods and/or
services. RFQ are usually not advertised
publicly, and are used commonly for (1)
standard, off-the-shelf items, (2) items
built to known specifications, (3) items
required in small quantities, or (4) items
whose purchase price falls below
sealed-bidding threshold. Suppliers
respond to a RFQ with firm quotations,
and generally the lowest-priced
quotation is awarded the contract. See
also invitation to bid (ITB), request for
tenders, and request for proposals.

Series HH bond Series HH bonds are sold in amounts

from $500 to $10,000. They may be
redeemed after only six months, and
their interest is exempt from state and
local taxes. The interest rate at the time
of purchase is locked in for the first 10
years that the bond is held. After ten
years, HH bonds enter extended
maturity and the new interest rate is
determined by the rate assigned to new
bonds issued at that time.
Short position Definition 1
Accounting: Net liability position
created by the excess of what is owed
over what is owned.
Definition 2
Foreign exchange trading: Situation
 where projected outflows of a currency
exceed its projected inflows.
Definition 3
Securities trading: Situation where a
dealer or investor (called short seller)
sells commodities, financial
instruments, shares, etc., which are to be
delivered on a future date at a certain
price, but which he or she does not own
at the time of sale. Short sellers are
'bear' speculators who expect to
purchase the item (at the time of
delivery) at a price lower than at which
it was sold. Opposite of long position.
Short selling Borrowing a security (or commodity
futures contract) from a broker and
selling it, with the understanding that it
must later be bought back (hopefully at
a lower price) and returned to the
broker. Short selling (or "selling short")
is a technique used by investors who try
to profit from the falling price of a
stock. For example, consider an investor
who wants to sell short 100 shares of a
company, believing it is overpriced and
will fall. The investor's broker will
borrow the shares from someone who
owns them with the promise that the
investor will return them later. The
investor immediately sells the borrowed
shares at the current market price. If the
price of the shares drops, he/she "covers
the short position" by buying back the
shares, and his/her broker returns them
to the lender. The profit is the difference
between the price at which the stock
was sold and the cost to buy it back,
minus commissions and expenses for
borrowing the stock. But if the price of
the shares increases, the potential losses
are unlimited. The company's shares
may go up and up, but at some point the
investor has to replace the 100 shares
he/she sold. In that case, the losses can
mount without limit until the short
position is covered. For this reason,
 short selling is a very risky technique.
For a while, SEC rules only allowed
investors to sell short only on an uptick
or a zero-plus tick, to prevent "pool
operators" from driving down a stock
price through heavy short-selling, then
buying the shares for a large profit. This
rule was eliminated in July 2007.
Top Highest ranking executives (with titles
management such as chairman/chairwoman, chief
executive officer, managing director,
president, executive directors, executive
vice-presidents, etc.) responsible for the
entire enterprise. Top management
translates the policy (formulated by the
board-of-directors) into goals,
objectives, and strategies, and projects a
shared-vision of the future. It makes
decisions that affect everyone in the
organization, and is held entirely
responsible for the success or failure of
the enterprise.
Trading book An accounting book that includes all
securities that the institution regularly
buys and sells on the stock market.
These securities are accounted for in a
different way than those in the banking
book, which are meant to be held by the
institution until they mature and are not
usually affected by market activity.

Work team Cross-functional, multi-skilled, and self-

directed group of employees responsible
for its own assignments, cost control,
goals, quality control, work orders,
work scheduling, and other such duties
and tasks. Work teams are most useful
where job content changes frequently
and employees with limited skills and a
specific set of duties are unable to cope.