Glossary of Terms 8 Flashcards
Tick Size
The size of the minimum movement in a quoted price e.g. 0.01 for gilts.
Tick Value
The change in the value of a futures contract when the price changes by one tick.
Time Deposit
A deposit that requires notice of withdrawal (or where a penalty is charged for withdrawals on demand).
Total Return Index
A performance measure that allows for coupons or dividends as well as changes in market values.
Tracking Error
The annual standardised deviation of the difference between portfolio return and benchmark return.
Trade Cycle
The periodic fluctuations of national output around its long-term-trend.
Traded Options
Option contracts with standardised features actively traded on organised exchanges.
Unit Trust
An open-ended investment vehicle whereby investors can buy “units” in an underlying pool of assets from the trust manager. If there is demand for units, the managers can create more units for sale to investors. If there are redemptions (sales by investors), the managers will buy in units offered to them. Unit trusts are trusts in the legal sense.
Warrant
An option issued by a company. The holder has the right to purchase shares at a specified price at specified times in the future.
Yield Curve
A plot of yield against term to redemption. Usually the yield plotted is the gross redemption yield on coupon-paying bonds but other yields can be used.
