Understanding the Markets
This text is a comprehensive resource from a leading financial management consultant for global banks and institutions which looks at the financial markets that support the trading, dealing and investment processes.
TABLE OF CONTENTS Understanding the Markets
B
- Back-to-back transaction
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See Turnaround.
- Balance of payments
- The difference between the total value of imports and exports. If imports are higher there is a deficit and if exports are higher there is a surplus.
- Ballot
- A random selection of applicants for a new issue of shares.
- Bank - commercial
- Organization that takes deposits and makes loans.
- Bank - merchant
- Organization that specializes in advising on takeovers and corporate finance activities.
- Bank of England
- The UK's central bank which undertakes policy decided by the Treasury and determines interest rates.
- Bankers' acceptance
- Short-term negotiable discount note, drawn on and accepted by banks which are obliged to pay the face value amount at maturity.
- Bargain
- Another word for a transaction or deal. It does not imply that a particularly favourable price was obtained.
- Barrier option
- Also trigger option, exploding option or extinguishing option. An option which is either cancelled or activated if the underlying price reaches a predetermined barrier or trigger level.
See also Knock-out option.
See also Knock-in-option.
- Base currency
- Currency chosen for reporting purposes.
- Basis (gross)
- The difference between the relevant cash instrument price and the futures price. Often used in the context of hedging the cash instrument.
- Basis (value or net)
- The difference between the gross basis and the carry.
- Basis point (B.P.)
- A change in the interest rate of one hundredth of one per cent (0.01%). One basis point is written as 0.01 when 1.0 represents 1%.
- Basis risk
- The risk that the price or rate of one...
Copyright David Loader 2002 under license agreement with Books24x7
