World Markets
Arbitrage is the process of exploiting differences in the price of an asset by simultaneously buying and selling it. In the process the arbitrageur pockets a risk-free return. Differences in prices u...
The Bovespa Index tracks around 50 stocks traded on the São Paulo Stock, Mercantile & Futures Exchange. The term Bovespa is derived from BOlsa de Valores do Estado de São Paulo, the Portugese ...
The CAC 40 Index is the benchmark tracking index for the Paris Bourse. Started in December of 1987 with a value of 1000, the CAC 40 is comprised of the 40 largest and most liquid stocks trading on ...
A Canada Learning Bond offers money to Canadian families to help them start saving for college. In general, under the program, the Canadian government gives families $500 in the form of a bond to st...
A Canadian rollover mortgage is an adjustable-rate mortgage commonly available to homebuyers in Canada. An adjustable-rate mortgage (ARM) is a mortgage in which the interest rate varies. The loans a...
Capital flight is the movement of capital from one country to another, or sometimes from one investment sector to another, to capitalize on returns or mitigate risk. Let's say the Venezuelan governm...
The DAX Index is the most commonly cited benchmark for measuring the returns posted by stocks on the Frankfurt Stock Exchange. Started in 1984, the DAX index is comprised of the 30 largest and most...
A dual listing occurs when a security (or shares of a company) is listed on more than one stock exchange. It may also be referred to as cross-listing or interlisting. This method of selling shares ha...
EAFE stands for Europe, Australasia, and the Far East -- a region that is considered the most developed outside of North America. The Morgan Stanley Capital International (MSCI) EAFE index is the mos...
An embargo is a government-instituted prevention of exports to a certain country. In the media world, an embargo is the release of information with the condition that it cannot be published or disse...
An emerging market economy describes a nation's economy that is progressing toward becoming more advanced, usually by means of rapid growth and industrialization. These countries experience an expand...
Euro Interbank Offered Rate (EURIBOR), is the rate at which European banks offer to lend unsecured funds to each other in the euro market. EURIBOR is sponsored by the European Banking Federation whi...
A eurobank is a financial institution that makes loans and accepts deposits in foreign currencies -- simplifying international trade, transactions and investing. If an American company wants to buy ...
A eurodollar is U.S. currency held in banks outside the U.S. (typically in Europe). Eurodollars are not the same thing as euros, the currency of the European Union. The eurodollar market began in th...
Europe, Australasia, Far East (or EAFE) refers to the economically developed regions of the world outside the United States and Canada. The EAFE is a broad market cap-weighted index that was formula...
The European Credit Research Institute (ECRI) provides analyses of retail financial services markets within the member states of the European Union. The ECRI is an independent, non-profit research i...
The Financial Times 100 Index (FTSE), also known as the "footsie," is the most widely used benchmark for the performance of equities traded on the London Stock Exchange. Started in January 1984 with ...
Frontier market describes up-and-coming economies that tend to be smaller and less developed than emerging markets like China and India. Frontier markets have a poor population willing to work to th...
Gnomes of Zurich is a slang, and often derogatory, term referring to Swiss bankers. A gnome is a mythical greedy creature that lives underground and guards money. Swiss banks are known for their sec...
In the investing world, the Halloween Massacre occurred in October 2006, when Canada began taxing all income trusts in the country. Many oil companies created income trusts in Canada, and they issue...
The Hang Seng Index is the leading index for shares traded on the Hong Kong Stock Exchange.  Started in 1969, the Hang Seng Index consists of the 45 largest companies that trade on the Hong Kong St...
The Ifo Business Climate Survey is a monthly measure of German business activity. The Ifo Business Climate Survey incorporates over 5,000 monthly survey responses from a variety of companies. The su...
An international banking facility (IBF) is a segregated branch of a domestic bank or financial institution available to only foreign customers. International banking facilities provide a range of l...
The phrase irrational exuberance was coined by Alan Greenspan, chairman of the Federal Reserve, in a December 5, 1996, speech to the American Enterprise Institute. In the speech, Greenspan asked, ...
Jurisdiction risk is the risk of doing business in another country. Let's assume you are considering purchasing a bond issued by a Canadian company or a bond issued by a Nigerian company. Both compa...
Kangaroos are slang for Australian stocks. For example, if Company XYZ is an Australian company whose stock trades on the Sydney exchange, it is a kangaroo. Kangaroos are a popular feature of the A...
The Korea Exchange (KRX) is the only securities exchange in South Korea. The KRX is headquartered in the city of Busan. The Korea Exchange is a consolidation of the Korean Stock Exchange, the KOSDAQ...
The Korean Composite Stock Price Index (KOSPI) is the main tracking index in South Korea. The KOSPI Index is comprised of 200 of the largest and most liquid issues traded on the Korean Stock Exchan...
The large value transfer system (LVTS) is a wire system in Canada that allows banks to transfer funds among each other. The Bank of Canada and the country's department of finance developed the LVTS,...
In the securities industry a lead bank is a company, usually an investment bank, that helps companies introduce their new securities into the market by leading a syndicate of investment banks to issu...
Macro risk is the risk that the political activity in a country will affect the operations of foreign companies that do business in that country. For example, let's say the government of the country...
Managed currency is the opposite of currency whose exchange rate is determined by the amount of supply and demand for the currency in the global marketplace. Most currencies, however, are managed by ...
Market arbitrage is a trading strategy whereby a trader sells a security in one market and buys the same security in another market. The practice of market arbitrage is based on assuming that an ass...
Mrs. Watanabe, also referred to as "Japanese Housewives," is a slang term for small, retail investors in Japan. Typically, Mrs. Watanabe traders are indeed women, and in the early 2000s they began t...
An ocean bill of lading is a receipt and invoice between a carrier and a shipper. For example, let's assume that Company XYZ is in Seattle and it wants to purchase goods from Supplier ABC in China. ...
The Office of Foreign Assets Control is the entity within the U.S. Treasury Department that creates and enforces trade sanctions. The OFAC used to be called the Office of Foreign Funds Control. The ...
In the banking world, Old Lady is a nickname for the Bank of England. The full nickname is "Old Lady of Threadneedle Street." The Bank of England is the United Kingdom's central bank, meaning that i...
A pegged exchange rate, also known as a fixed exchange rate, is a type of exchange rate in which a currency's value is fixed against either the value of another country's currency or another measur...
The Eurozone nations of Portugal, Ireland, Italy, Greece and Spain make up a group of financially weak countries often referred to in the financial media by the acronym PIIGS. The Eurozone is made u...
A qualified domestic institutional investor (QDII) is an institution allowed to invest in foreign securities.  China runs one of the most well known QDII programs. There, the China Securities Regul...
A qualifying transaction occurs when a private company issues publicly traded stock in Canada. For example, let's assume Company XYZ is a Canadian company that is privately held. Company XYZ wants t...
Revaluation refers to the adjustment of the exchange rate of a country's currency. In countries with fixed exchange rate rates, the central bank (i.e. the country's government) can change the offici...
A saitori is a member of the Tokyo Stock Exchange who matches buy and sell orders. Saitori are similar to specialists in the New York Stock Exchange. They match up brokers' buy and sell orders, and ...
The Shanghai Composite Index tracks the biggest and most important public companies in China. The Shanghai Composite Index is similar to the Dow Jones Industrial Average (DJIA) in the U.S. The Shan...
The SSE Composite Index tracks the largest and most important public companies in China.  The SSE Composite Index is similar to the Dow Jones Industrial Average (DJIA) in the U.S. The SSE Composit...
The Stock Exchange Daily Official List code is a unique identifier generated by the London Stock Exchange for securities issued in the U.K. Each U.K.-issued security traded on the London Stock Excha...
The Straits Times Index is Singapore's premier equity index and the most widely used benchmark for the performance of equities traded on the Singapore Stock Exchange. The index is comprised of 55 of...
The TED spread was originally calculated as the difference between interest rates on 3-month T-bills and 3-month Eurodollar contracts with identical expiration months. The acronym is derived from the...
Transaction risk is the risk that a company will incur losses in a transaction comprising multiple currencies due to exchange rate movements. Companies often engage in transactions involving more th...
A traveler's check is a certified note issued by a bank that may be used by travelers as a risk-free substitute for paper currency. When individuals travel, particularly abroad, they often need cash...
Umberto Agnelli was a well-known chairman of Italian automaker Fiat -- the famous maker of the Fiat and the Ferrari. Born in Lausanne, Switzerland, in 1934, Agnelli was one of seven children. His fa...
In a Walrasian market, buy and sell orders are grouped together and then executed at specific times, rather than executed one by one continuously. Let's assume that the following buy orders for Comp...
In a brokerage firm, a wire room receives customer orders from brokers, sends the orders to the exchanges, and sends back notices of execution.   For instance, let's say John Doe is a broker at Br...
The World Bank is an international financial institution dedicated to reducing poverty around the world through capital investment and the facilitation of trade. Based in Washington, D.C., the World...
Xetra is a trading system owned by the Deutsche Borse (German stock exchange). Started in 1997, about 250 participants (mostly brokerages, dealers, and market makers) in 19 countries use Xetra, whic...
The ZEW Economic Sentiment is a monthly survey of economic sentiment in Germany. (The acronym stands for Zentrum für Europäische Wirtschaftsforschung GmbH, or Centre for European Economic Research....