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Term Definition: # | A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

Easing A modest decline in price. 
Economic Indicator A government issued statistic that indicates current economic growth and stability. Common indicators include employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.
EMS Abbreviation for European Monetary System, an agreement between member nations of the European Union to maintain an alignment between the exchange rates of their respective currencies. EURO - the currency of the European Monetary Union (EMU). A replacement for the European Currency Unit (ECU). European Central Bank (ECB) - the Central Bank for the new European Monetary Union.
European Monetary Unit  The principal goal of the EMU is to establish a single European currency called the euro, which will officially replace the national currencies of the member EU countries in 2002. Currently, the euro exists only as a banking currency and for paper financial transactions and foreign exchange. The current members of the EMU are Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal.
Equity The amount currently held in a customerís account calculated as if all the opened positions will be closed at the current market quotes. The account is comprised of unrealized gains, less unrealized losses and plus or minus storage.
Euro Zone The group of 12 countries that have combined their currencies into a single currency (euro). They still have separate sovereignties, but also have a combined central bank (ECB) which handles economic policy issues for them as one group.
Exchange control A system for controlling inflows and outflows of foreign exchange; the devices include licensing multiple currencies, quotas, auctions, limits, levies and surcharges.
Exotic A less broadly traded currency. 
Exposure (i) Net working capital - the current assets in a foreign currency minus current liabilities in the currency;(ii) Net financial method - the current assets in a foreign currency minus current liabilities and long-term debt in the currency;(iii) Monetary/non-monetary method - monetary assets and liabilities in the foreign currency are valued at current exchange rates, while non-monetary items are entered at the relevant historic rates. 
 
Easing: Modest decline in price
Economic Indicator: A statistics which indicates current economic growth rates and trends such as retail sales and employment.
ECU: European Currency Unit
EDI: Electronic Data Interchange
Effective Exchange Rate: An attempt to summarise the effects on a country's trade balance of its currency's changes against other currencies.
EFT: Electronic Fund Transfer
Either way market: In the Euro interbank deposit market where both bid and offer rates for a particular period are the same.
Emu: Name of currency that is to be the vehicle for European monetary union under the Maastricht Treaty.
EMS: European Monetary System
End/end: Indicates that both the spot and forward maturity, or two forward maturities in a swap transaction, fall due on the last business day of appropriate calendar months.
English Auction: Bidders buy bonds at the price they bid provided it is above the stop price.
Entrepot: A term used for international trade where goods are shipped to a centre for reexport. Hong Kong engages in significant amounts of this form of trade.
EOE: European Options Exchange
Epsilon: The change in the price of an option associated with a 1% change in implied volatility( technically the first derivative of the option price with respect to volatility). Also referred to as eta, vega, omega and kappa
ERM: Exchange Rate Mechanism
Euro clear: A computerised settlement and depository system for safe custody, delivery of, and payment for Eurobonds. The settlement convention is three business days after trade.
Euro Rates: The rates quoted for Euro-currencies.
Eurobonds: A long-term loan issued in a currency other than that of the country or market in which it is issued. Interest is paid without the deduction of tax.
Eurocurrency: A currency domiciled outside its country of origin normally held by non residents.
Eurodollars: US dollars deposited in a bank (US or non US) located outside the USA.
Eurofranc: Swiss French or Belgian francs traded on the Eurocurrency market. Normally swiss as the more common currency.
Euromark: Deutschmarks traded on the Eurocurrency market.
European Monetary System: A system designed to stabilise if not eliminate exchange risk between member states of the EMS as part of the economic convergence policy of the EU. It permits currencies to move in a measured fashion (divergence indicator) within agreed bands (the parity
European option: An option that can be exercised only on its expiration date rather than before that date.
European Union: The grouping formerly known as the European Community, an organisation wishing to facilitate inter member trade and economic intergration.
Excess Liquidity: The maintenance by banks of a higher level of funds than is normally desirable, usually arising due to a drop in demand for funds because of economic conditions or interest rates.
Exchange control: A system of controlling inflows and out flows of foreign exchange, devices include licencing multiple currencies, quotas, auctions, limits, levies and surcharges.
Exchange Equalisation Account: An account controlled by the UK Treasury and managed by the Bank of England. Its assets include the country's gold and foreign exchange reserves. Its objective is to manage the exchange rate in accordance with government policy.
Exchange of futures for cash: A transaction in which the buyer of a cash commodity transfers to the seller a corresponding amount of long futures contracts, or receives from the seller a corresponding amount of short futures, at a price difference mutually agreed upon. In this way, th
Ex-dividend date: The ex-dividend date determines who, from a trading perspective, receives the next coupon payment. Transactions settled on or after the ex-dividend date are deemed to be "ex-coupon" and therefore, the buyer does not receive the next coupon. The seller mus
Exercise notice: The formal notification that the holder of a call (or put) option wishes to buy (or sell) the underlying security at the exercise price.
Exercise limit: A limit on the number of options contracts a holder may exercise within a specific period.
Exercise price: See Strike price.
Exercise value: For a call option, this is the amount by which the strike price is below the underlying investment; for a put option, it is the amount by which the strike price is above the underlying investment.
Exotic: A less broadly traded currency.
Expiration date: (1) Options - the last date after which the option can no longer be exercised. (2) Bonds - the date on which a bond matures.
Expiration month: The month in which an option expires.
Expiry date: The last date on which an option can be bought or sold.
Exposure: see position and mismatch. Various methods of calculating an exposure exist: (i) Net working capital:- The current assets in a foreign currency minus current liabilities in the currency; (ii) Net financial method: The current assets in a foreign currency 
Extendible bond: A bond with a call provision that gives the issuer the option to extend the maturity date (if the call is not exercised) and reset the coupon at any rate. The investor then may choose to put the bond at the call price or accept the new coupon.
Extrinsic value: See Time value.


Term Definition: # | A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

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