The derived volatility of an asset calculated indirectly from options prices.
In the Money
Refers to a call or put option that has intrinsic value because the exercise price is below or above, respectively, the current market price of the underlying security.
Investment funds which seek to mirror the returns of a market index by investing directly in the securities that make up that index.
Price quoted by a dealer for information purposes. Opposite of a Firm Quote.
Economic indicator that measures the total value of output produced by manufacturers, mines and utilities. This data point tends to mirror the expansions and contractions of the business cycle and can act as a leading indicator of economic growth.
Refers to a general rise in the price level of goods and services, measured by a price index, which leads to a decrease in the purchasing power of money.
Funds required to enter into a leveraged transaction,quoted as a percentage of the price of the asset.
Market open only to large financial institutions.
Foreign Exchange rates (or interest rates) quoted by large multinational banking institutions.
Cost of using/borrowing money, expressed as a rate per period of time.
Interest Rate Swap
Derivative in which one party exchanges a stream of interest payments for another party’s stream of cash flows.
Institute for Supply Management (ISM) Manufacturing Index
Economic indicator that measures the state of the US manufacturing sector by surveying executives on expectations for future production, new orders, inventories, employment and deliveries. Values over 50 generally indicate an expansion, while values below 50 indicate contraction. There is also a non-manufacturing version of the index.
International Organization for Standardization (ISO)
International-standard-setting body composed of representatives from various national standards organizations, which determines among other things, the trading codes used by forex traders, such as EUR for Euro.
Refers to the act of a Central Bank buying or selling currency in the spot market in order to influence the value of its own currency.
International Monetary Fund (IMF)
International organization that oversees the global financial system by following the macroeconomic policies of its member countries, in particular those with an impact on exchange rates and the balance of payments.
International Monetary Market (IMM)
Arm of the Chicago Mercantile Exchange that lists a number of currency and financial futures.
International Securities Dealers Association (ISDA)
Organization charged with regulating inter-bank markets and exchanges.
Any position that is opened and closed within the same trading day.
Calculated difference between an option’s exercise price and the current market price of the underlying security. May be zero.