GLOSSARY

Question 1

AUTHORISATION

Answer 1

Required status under the FSMA for firms that wish to provide financial services

Question 2

ARTICLES OF ASSOCIATION

Answer 2

Constitution of the company, shareholder rights, company borrowing power

Question 3

EXCHANGE TRADED FUND

Answer 3

A open ended collective investment scheme, but traded on an exchange.

Question 4

FSMA

Answer 4

Financial Services and Markets Act 2000, framework for regulating financial services.

Question 5

FRNs

Answer 5

Debt securities, with interest linked to benchmark rate. EG SONIA/LIBOR

Question 6

ICE FUTURES EUROPE

Answer 6

Futures exchange for energy, based in London

Question 7

LIFFE

Answer 7

UKs principal derivatives exchange for trading financial and soft commodity derivatives

Question 8

LOAN STOCK

Answer 8

Corporate bond issued without underlying collateral

Question 9

MEMORANDUM OF ASSOCIATION

Answer 9

Defines a companies powers, and it’s relationship with the outside world.

Question 10

PROTECTIONISM

Answer 10

Economic policy of restricting trade between countries via tariffs

Question 11

REDEMPTION YIELD

Answer 11

Incorporates both capital return and capital return in one figure

Question 12

SETTLOR

Answer 12

Creator of a trust

Question 13

SICAV

Answer 13

Societe d’Investment a Capital Variable, European OEIC

Question 14

SPECIAL RESOLUTION

Answer 14

Resolution that requires 75% of shareholder votes cast.

Question 15

SEAQ

Answer 15

Stock Exchange Automated Quotation, mainly for fixed income/small cap

Question 16

TREASURY

Answer 16

Government department responsible for regulation of financial services.