Financial Glossary



A country is said to have an absolute advantage if its output per unit of inputs of all goods is larger than that of another country A record of financial transactions for an individual at a at a bank or a brokerage company The dollar amount currently remaining in an account An individual who usually works for a brokerage company and has the legal power to buy or sell financial instruments on behalf of a client A summary of all transactions and positions (long and short) between a broker/dealer and a client Money owed to customers or suppliers Money owed by customers Accredited investors must have a combined net worth with their spouse in excess of $1,000,000, or individual income for the past two years in excess of $200,000, or have joint income with their spouse in excess of $300,000 for the past two years or be a director or executive officer of the company The volume of financial instruments over a given period of time An interest rate that is adjusted periodically, usually according to a standard market rate outside the control of the bank or savings institution Relationship between two companies when one company owns substantial interest of another company Trading after regular trading hours on organized exchanges An agent acts as intermediary between buyer and seller, taking no financial risk personally or as a firm, and charging a commission for the service The total demand for goods and services produced in the economy over a period of time. It includes consumer demand of durable and nondurable items, investment spending by companies on capital goods, government spending on publicly provided goods and services, and the difference between exports and imports of goods and services of the country A measure of the total supply of goods and services produced within the economy from domestic sources that are available to meet aggregate demand A Futures order that instructs the broker to either fill the whole order or not at all A coefficient measuring the risk-adjusted performance of a currency or stock option. A large alpha indicates that the underlying has performed better than would be predicted given its beta (volatility) Investments in hedge funds that pursue strategies uncommon in mutual funds such as long-short equity, event driven, statistical arbitrage, fixed income arbitrage, convertible arbitrage, short bias, global macro, and equity market neutral An option that may be exercised at any time prior to expiration, as opposed to a European option that can only be exercised on a specific date (usually at expiration) American Stock Exchange The formal securities market in Jordan The repayment of a loan by installments An employee of a brokerage house who studies companies and makes buy/sell recommendations on various instruments Date when particular news concerning a company is announced to the public Yearly record of a company's financial condition. It includes the firm's operations, balance sheet, income statement, and cash flow statement The simultaneous purchase and sale of the same (or equivalent) financial instrument on different markets to profit from price discrepancies The price at which the currency or instrument is offered Any possession that has value A security that is collateralized by loans, leases, receivables, or installment contracts on personal property, not real estate. Account at a brokerage house, bank, or savings institution that integrates banking services and brokerage features Instructions given to a dealer to buy or sell the currency or instrument at the best rate that can be obtained Instructions given to a dealer to buy or sell the currency or instrument at a specific rate or better A price equal to nominal or face value of a security A buy or sell order that must be executed at the best price currently available in the market. These are also called market orders An option whose strike/exercise price is equal to or near the current market price of the underlying instrument An examination of a company's accounting records and books conducted by an outside professional in order to determine whether the company is maintaining records according to generally accepted accounting principles On limit orders, a buy order away from the market would be placed lower than the current market price, and sell orders would be placed higher than the current market price. Such orders are usually held to be executed later