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Jawbone

Announcements and statements by politicians or monetary authorities to influence decisions by business, consumer, or trade union sectors, often associated with forecasts and policy implications.


Job-to-applicant ratio

The job-to-applicant ratio shows how many positions are available to a job seeker


Jobber

A trader who trades for small, short-term profits during the course of a trading session, rarely carrying a position overnight.


Jobless Claims Change

Measures the number of people who claim unemployment benefits, but are actively seeking work. Released with the Claimant Count report, Jobless Claims Change serves as a barometer for the health of the UK labor market. It is similar to the Claimant Count except the headline figure is as an actual number, whereas the Claimant Count is a percentage. Higher job growth accompanies economic expansion and could spark inflationary pressures.


Jurisdiction Risk

(1) The risk inherent in placing funds in the Centre where they will be under the jurisdiction of a foreign legal authority. (2) The risk in making a loan subject to the laws of another country.


Juristiction

The geographical area over which a court or government body has the power and right to exercise authority.






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Key currency

One of the national currencies (dollar, euro, yen, etc.) or IMF's special drawing rights (SDR) used by a country to hold its foreign currency reserves and gold for settling international trade transactions and other obligations. Also called reserve currency.

Kiwi

Slang for the New Zealand dollar.




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Labor Cash Earnings - Japan

The average amount of pre-tax earnings per regular employee, including overtime pay and bonuses. Though the report does not take into account all sources of household income (accumulated wealth and capital gains from financial assets are omitted), Labor Cash Earnings accurately reflects the spending ability of domestic consumers, one of the driving forces behind economic growth. Because growth in wages fuels higher consumption, rising Labor Cash Earnings generally lead to higher inflation.

Labour Productivity - Canada

Average productivity level of Canadian workers. Labour Productivity is calculated by dividing the gross domestic product (GDP) by the number of hours worked, yielding output per hour, which is the key measure of productivity growth. The availability of better technology and higher levels of education among the workforce are factors commonly attributed to increased productivity. Growth in labour productivity is usually seen as a sign of a healthy economy because higher productivity allows higher output for a fixed population. Rising Labour Productivity can also offset inflationary pressures associated with economic growth and spending. Economic expansion attributed to increased Labour Productivity will not result in inflation, meaning that central banks will not need to increase interest rates during times of high growth.

Large Company

In the manufacturing sector, all companies with total employment of 50 or more were included in the large company partition. In the nonmanufacturing sector, all companies with total employment of 15 or more were included in the large company partition.

Large Retailers' Sales

The total value of goods sold in large department stores, chain convenience stores, and supermarkets in a particular month. The report serves as a direct gauge of consumption and consumer confidence. Consumer spending is one of the most important leading indicators for the Japanese economy. An increasing number of sales can signal consumer confidence and economic growth, but higher consumption can also leads to inflationary pressures.

Last Trading Day

The day on which trading ceases for an expiring contract.

Layoff

The elimination of jobs, often without regard to employee performance, usually when a company is experiencing financial difficulties.

lb

Abbreviation for pound:(in English-speaking countries) an avoirdupois unit of weight equal to 7000 grains, divided into 16 ounces (0.453 kg), used for ordinary commerce. Abbreviation: lb., lb. av.

LDC

Less developed countries, often used with respect to secondary debt market.

Lead

Payment of a financial obligation earlier than is expected or required.

Leading Indicator Index

Leading indicator index brings together a number of economic indicators that tend to precede the rest of the economy.

Leading Indicators

Statistics that are considered to predict future economic activity.

Leads and Lags

The effect on foreign trade payments of an anticipated move in the exchange rate, normally a devaluation. The importers speeden up the payment for the imports and exporters delay recieving payment for the exports.

Left-hand Side

Taking the left hand side of a two way quote i.e. selling the quoted currency

Letter of Credit

A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. In the event that the buyer is unable to make payment on the purchase the bank will be required to cover the full or remaining amount of the purchase.

Often used in international transactions to ensure that payment will be received. Due to the nature of internation dealings such as distance, differing laws in each country, and difficulty in knowing each party personally the use of letters of credit has become a very important aspect of international trade. The bank also acts on behalf of the buyer (holder of letter of credit) where the supplier will not be paid until the supplier confirms to the bank that the goods have been shipped.

Leverage

The degree to which an investor or business is utilizing borrowed money. Companies that are highly leveraged may be at risk of bankruptcy if they are unable to make payments on their debt; they may also be unable to find new lenders in the future. Leverage is not always bad, however; it can increase the shareholders' return on their investment and often there are tax advantages associated with borrowing. also called financial leverage

For example, suppose a trader puts down $1,000 as a margin in order to control $100,000. In this case, the trader's leverage would be 100:1 because the trader controls one-hundred times what he put down. Likewise, his level of margin would be 1% because only 1% was required to open the larger position

Liability

A company's legal debts or obligations that arise during the course of business operations. These are settled over time through the transfer of economic benefits including money, goods or services.

Recorded on the balance sheet (right side), liabilities include loans, accounts payable, mortgages, deferred revenues and accrued expenses. Liabilities are a vital aspect of a company's operations because they are used to finance operations and pay for large expansions. They can also make transactions between businesses more efficient. For example, the outstanding money that a company owes to its suppliers would be considered a liability.

Outside of accounting and finance this term simply refers to any money or service that is currently owed to another party. One form of liability, for example, would be the property taxes that a homeowner owes to the municipal government.

Current liabilities are debts payable within one year, while long-term liabilities are debts payable over a longer period.

LIBOR

London Interbank Offered Rate
a.An interest rate at which banks can borrow funds, in marketable size, from other banks in the London interbank market. The LIBOR is fixed on a daily basis by the British Bankers' Association. The LIBOR is derived from a filtered average of the world's most creditworthy banks' interbank deposit rates for larger loans with maturities between overnight and one full year.
b.The LIBOR is the world's most widely used benchmark for short-term interest rates. It's important because it is the rate at which the world's most preferred borrowers are able to borrow money. It is also the rate upon which rates for less preferred borrowers are based. For example, a multinational corporation with a very good credit rating may be able to borrow money for one year at LIBOR plus 4 or 5 points. The LIBOR is the world's most widely used benchmark for short-term interest rates. It's important because it is the rate at which the world's most preferred borrowers are able to borrow money. It is also the rate upon which rates for less preferred borrowers are based. For example, a multinational corporation with a very good credit rating may be able to borrow money for one year at LIBOR plus 4 or 5 points.
Countries that rely on the LIBOR for a reference rate include the United States, Canada, Switzerland and, of course, England.

LIBOR - London Inter Bank Offer Rate

British Bankers' Association average of interbank offered rates for dollar deposits in the London market based on quotations at 16 major banks. Effective rate for contracts entered into two days from date appearing.

Life of Contract

The period between the beginning of trading in a particular future and the expiration of trading.

LIFFE

London International Financial Futures Exchange.

Limit

A maximum or minimum amount

Limit Down

Maximum price drop allowed on a futures contract in a single trading day.

Limit Move

The largest price change allowed for a given futures contract in a single day, as determined by the exchange. also called maximum price fluctuation.

Limit Order

To avoid buying or selling a stock at a price higher or lower than you wanted, you need to place a limit order rather than a market order. A limit order is an order to buy or sell a security at a specific price. A buy limit order can only be executed at the limit price or lower, and a sell limit order can only be executed at the limit price or higher. When you place a market order, you can't control the price at which your order will be filled. For example, if you want to buy the stock of a "hot" IPO that was initially offered at $9, but don't want to end up paying more than $20 for the stock, you can place a limit order to buy the stock at any price up to $20. By entering a limit order rather than a market order, you will not be caught buying the stock at $90 and then suffering immediate losses if the stock drops later in the day or the weeks ahead. Remember that your limit order may never be executed because the market price may quickly surpass your limit before your order can be filled. But by using a limit order you also protect yourself from buying the stock at too high a price. Some firms may charge you more for executing a limit order than a market order.

Limit Up

Maximum price increase allowed on a futures contract in a single trading day.

Limited Convertibility

When residents of a country are prohibited from buying other currencies even though non-residents may be completely free to buy or sell the national currency and the foreign institutional investors also have the liberty to buy and sell shares on the stock exchange of that country.

line of credit

An arrangement in which a bank or vendor extends a specified amount of unsecured credit to a specified borrower for a specified time period. also called credit line.

Liquid and Illiquid Markets

The ability of a market to buy and sell at ease with no impact on price stability. A market is described as liquid if the spread between the bid and the offer is small. Another measure of liquidity is the presence of buyers and sellers, with more players creating tighter spreads. Illiquid markets have fewer participants; thus, the spreads are wider and the risk to the short-term trader are greater.

Liquidity

1 Liquid Market - the degree to which market participants are willing to buy and sell at every price level.
Liquid markets are characterized a high level of trading actively preformed by a diverse group of traders (hedgers, corporations, governments, speculators).
Liquid markets are usually described as safer, since investors are more certain that they are able to get into or out of a trade in any market condition.

2 Liquid Asset - the degree to which an asset is able to be converted into quickly into cash. The classic examples of liquid assets are Money Market Accounts and Certificate of Deposits or in equities, Blue Chip stocks.


Liquidity Risk

The risk stemming from the lack of marketability of an investment that cannot be bought or sold quickly enough to prevent or minimize a loss.

Local

A futures trader who normally trades on an exchange on his/her own account.

Locked Market

A market is locked when the bid price equals the asked price.

London Inter Bank Offer Rate (LIBOR)

British Bankers' Association average of interbank offered rates for dollar deposits in the London market based on quotations at 16 major banks. Effective rate for contracts entered into two days from date appearing.

Long

In foreign exchange, when a currency pair is bought, it is understood that the primary currency in the pair is 'long', and the secondary currency is 'short'.

Long - Position

A position that was obtained by buying in anticipation of an increase in price.

Long Hedge

The purchase of futures contracts for price protection purposes, as a defensive position against an increase in cash prices, or falling interest rates. The purchase of a futures contract or call option to protect a short position against possible increases in the prices of commodities, currencies, indexes, or securities. For example, an investor might purchase a futures contract on fixed-income securities to protect against a decline in interest rates. Also called buying hedge.

Long/Short

A trader is in a LONG POSITION when she buys a currency pair.
Shorting is the opposite of going long. The trader is in a SHORT POSITION when she sells a currency pair.

For example, when a trader buys EUR/USD, she is "longing" the Euro while at the same time "shorting the US dollar. If she were to decide to sell EUR/USD, she is "shorting" Euros and "Longing" the US dollar.

Lot

A unit to measure the amount of the deal. The value of the deal always corresponds to an integer number of lots.

LSE

London Stock Exchange






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M0

Cash in circulation . Only used by the UK.

M1

Cash in circulation plus demand deposits at commercial banks. There are variations between the precise definitions used by national financial authorities.

machin tool

A machine tool is a powered mechanical device, typically used to fabricate metal components of machines by machining, which is the selective removal of metal. The term machine tool is usually reserved for tools that used a power source other than human movement, but they can be powered by people if appropriately set up. Many historians of technology consider that the true machine tools were born when direct human involvement was removed from the shaping or stamping process of the different kinds of tools. For instance, they consider that lathe machine tools were invented around 1751 by Jacques de Vaucanson because he was the first to mount the cutting instrument on a mechanically adjustable head, taking it out of the hands of the operator

Maintenance

A set minimum margin that a customer must maintain in his margin account

Majors

These are the most popular currency pairs available for trading and include EUR/USD, GBP/USD, USD/JPY, USD/CHF, USD/CAD and AUD/USD. Less traded pairs are known as 'Exotics'.

Make a Market

A dealer is said to make a market when he quotes both the bid and offer prices at which he stands ready to buy and sell.

Managed Float

When the monetary authorities intervene regularly in the market to stabilise the rates or to push the exchange rate in a required direction. It is also called the dirty float which we have in India.

Manufacturing I/S Ratio - Canada

The ratio of inventory to shipments at Canadian manufacturing firms. By examining inventories and shipments, the figure is able to gauge to what degree manufacturing firms are satisfying market demand. Inventories include goods not yet sold by firms. Growing inventories are a sign of declining demand as unsold goods pile up in warehouses. Shipments data, on the other hand, is indicative of market demand.
Accordingly, a Manufacturing I/S Ratio greater than 1 suggests an inventory build-up and decreasing demand for manufactured goods, while a ratio less than 1 suggests an inventory reduction and increasing demand for manufactured goods. The I/S Ratio can also be interpreted as an estimate of the time (in months) that it would take to exhaust inventories, holding shipments constant.

Manufacturing Shipments

The ratio of inventory to shipments at Canadian manufacturing firms. By examining inventories and shipments, the figure is able to gauge to what degree manufacturing firms are satisfying market demand. Inventories include goods not yet sold by firms. Growing inventories are a sign of declining demand as unsold goods pile up in warehouses. Shipments data, on the other hand, is indicative of market demand.
Accordingly, a Manufacturing I/S Ratio greater than 1 suggests an inventory build-up and decreasing demand for manufactured goods, while a ratio less than 1 suggests an inventory reduction and increasing demand for manufactured goods. The I/S Ratio can also be interpreted as an estimate of the time (in months) that it would take to exhaust inventories, holding shipments constant.
The data used to calculate the I/S ratio can be found in the monthly survey of manufacturing released by Statistics Canada each month. The I/S ratio is also a component of the Canadian Leading Indicator Index.


Margin

Margin is a good faith deposit that a trader puts up as collateral to hold a position. The amount of margin that the trader puts up determines his leverage. For example, suppose a trader puts down $1,000 as a margin in order to control $100,000. In this case, the trader's leverage would be 100:1 because the trader controls one-hundred times what he put down. Likewise, his level of margin would be 1% because only 1% was required to open the larger position.

Margin Call

A call for additional funds in a margin account either because the value of equity in the account has fallen below a required minimum (also termed a maintenance call) or because additional currencies have been purchased (or sold short).

Marginal Risk

The risk that a customer goes bankrupt after entering into a forward contract. In such an event the issuer must close the commitment running the risk of having to pay the marginal movement on the contract.

Mark-to-Market

Recording the price or value of a security, portfolio, or account on a daily basis, to calculate profits and losses or to confirm that margin requirements are being met.

Market Close

This refers to the time of day that a market closes. In the 24 hour-a-day foreign exchange market, there is no official market close. 5:00 PM EST is often referred to and understood as the market close because value dates for spot transactions change to the next new value date at that time.

Market Maker

A dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial instrument.

Market Order

An order to buy or sell a stock immediately at the best available current price.

Market Rate

The current quote of a currency pair.

Market Risk

The risks that occur when general market pressures cause the value of an investment to fluctuate.

Market Timing

Attempting to predict future market directions, usually by examining recent price and volume data or economic data, and investing based on those predictions.

Market Value

1.Market value of a forex position at any time is the amount of the domestic currency that could be purchased at the then market rate in exchange for the amount of foreign currency to be delivered under the forex Contract.

2.The last reported sale price of a security, or the current bid and ask price in the context of an over-the-counter security. Also known as market price.

Market-Maker

A person or firm that provides liquidity making two-sided prices (bids and offers) in the market.

Markup

Premium

Maturity

The date on which payment of a financial obligation is due.

Maturity Date

(1) The last trading day of a futures contract. (2) Date on which a bond matures, at which time the face value will be returned to the purchaser. Sometimes the maturity date is not one specified date but a range of dates during which the bond may be repaid.

MBA

Mortgage Bankers Association of America

Merchandise Trade Balance

The Merchandise Trade Balance is a measure of "visible" trade, which is trade in goods like cars and electronics. Specifically it is the difference between Japan 's imports of goods and exports of goods, excluding services. A positive value indicates a trade surplus (exports exceed imports) while a negative value indicates a trade deficit (imports exceed exports). Movements in the Merchandise Trade Balance reflect altered demand for Japanese Yen, which can move the value of the currency. Positive growth in the trade balance may lead to a future appreciation of the Yen due to steady demand in exchange for Japanese exports. The Merchandise Trade report itself gives insight into changing trends regarding Japanese trade. Such developments are especially important for Japan , which is an export-oriented economy that has historically experienced large trade surpluses, any affect on this could have dramatic affect on the domestic economy. The headline figure is expressed as a percentage change from the last equivalent period, and a positive percentage change can indicate that export growth has exceeded import growth.

Micro economics

The study of the behavior of small economic units, such as that of individual consumers or households. opposite of macroeconomics.

Microcredit

A.the lending of very small amounts of money at low interest, esp. to a start-up company or self-employed person.

B.An extremely small loan given to impoverished people to help them become self employed. Also known as "microlending."

Mid-price or middle rate

The price half-way between the two prices, or the average of both buying and selling prices offered by the market makers.

Mine and Yours

Terms used by floor traders to signify buying and selling. Mainly used in forex transactions

If a trader wanted to buy something, he/she would type or say "Mine," as in "It's mine." If the trader wanted to sell, he/she would type or say "Yours," as in "It's yours."

Minimum price fluctuation

The smallest increment of market price movement possible in a given futures contract.

Mio

Million

MITI

Japanese ministry of International Trade & Industry.

MM

Money Markets

MOF

Ministry Of Finance

Momentum

The tendency of a currency pair to continue movement in a single direction.

Monetary Base-Japan

Currency supplied by the Bank of Japan. The Monetary Base includes all banknotes and coins in circulation plus all currency held as deposits by the Bank of Japan. As an official measure of the Japanese money supply, the Monetary Base will show the immediate impacts of monetary policy actions and can give an indication into the future direction of inflation. An expansion in the monetary base is generally inflationary while a decline will likely have the opposite effect.

Money Market

Highly liquid markets for short-term investing in monetary instruments and debts, typically maturing in less than one year. Because of large transaction cost relative to potential interest, transactions occur in large amounts and thus participants are mainly banks and other large financial institutions.

Money market Instuments

Short-term, high grade (low risk) financial instruments such as bankers' acceptance, certificates of deposit (CDs), commercial paper, and treasury bills.

Money Supply

The total supply of money in circulation in a given country's economy at a given time. There are several measures for the money supply, such as M1, M2, and M3. The money supply is considered an important instrument for controlling inflation by those economists who say that growth in money supply will only lead to inflation if money demand is stable. In order to control the money supply, regulators have to decide which particular measure of the money supply to target. The broader the targeted measure, the more difficult it will be to control that particular target. However, targeting an unsuitable narrow money supply measure may lead to a situation where the total money supply in the country is not adequately controlled.

mortgage-backed security (MBS)

In finance, a mortgage-backed security (MBS) is an asset-backed security whose cash flows are backed by the principal and interest payments of a set of mortgage loans. Payments are typically made monthly over the lifetime of the underlying loans.

Moving Average

A technical analysis term meaning the average price of a security over a specified time period (the most common being 20, 30, 50, 100 and 200 days), used in order to spot pricing trends by flattening out large fluctuations. This is perhaps the most commonly used variable in technical analysis. Moving average data is used to create charts that show whether a stock's price is trending up or down. They can be used to track daily, weekly, or monthly patterns. Each new day's (or week's or month's) numbers are added to the average and the oldest numbers are dropped; thus, the average "moves" over time. In general, the shorter the time frame used, the more volatile the prices will appear, so, for example, 20 day moving average lines tend to move up and down more than 200 day moving average lines.

MPC-Marginal Propensity To Consume

A component of Keynesian theory, MPC represents the proportion of an aggregate raise in pay that is spent on the consumption of goods and services, as opposed to being saved.

Let's illustrate this with an example. Suppose you receive a bonus with your paycheck, and it's $500 on top of your normal annual earnings. You suddenly have $500 more in income than you did before. If you decide to spend $400 of this marginal increase in income on a new business suit, your marginal propensity to consume will be 0.8 ($400 divided by $500).

Mutual fund

An open-ended fund operated by an investment company which raises money from shareholders and invests in a group of assets, in accordance with a stated set of objectives. mutual funds raise money by selling shares of the fund to the public, much like any other type of company can sell stock in itself to the public. Mutual funds then take the money they receive from the sale of their shares (along with any money made from previous investments) and use it to purchase various investment vehicles, such as stocks, bonds and money market instruments. In return for the money they give to the fund when purchasing shares, shareholders receive an equity position in the fund and, in effect, in each of its underlying securities. For most mutual funds, shareholders are free to sell their shares at any time, although the price of a share in a mutual fund will fluctuate daily, depending upon the performance of the securities held by the fund. Benefits of mutual funds include diversification and professional money management. Mutual funds offer choice, liquidity, and convenience, but charge fees and often require a minimum investment. A closed-end fund is often incorrectly referred to as a mutual fund, but is actually an investment trust. There are many types of mutual funds, including aggressive growth fund, asset allocation fund, balanced fund, blend fund, bond fund, capital appreciation fund, clone fund, closed fund, crossover fund, equity fund, fund of funds, global fund, growth fund, growth and income fund, hedge fund, income fund, index fund, international fund, money market fund, municipal bond fund, prime rate fund, regional fund, sector fund, specialty fund, stock fund, and tax-free bond fund.