International Financial Markets Flashcards
COMMODITY
Basic good used in commerce that is interchangeable with other goods of the same type.
HARD COMMODITY
Natural resource that needs to be mined or extracted (gold, oil)
SOFT COMMODITY
Agricultural product or livestock (coffee, rice, pork)
DERIVATIVE
Security (financial contract) with a price that depends upon or derived from one or more underlying assets.
EQUITY MARKET
Method for companies to raise capital and investors to own a piece of a company.
OVER THE COUNTER (OTC)
Process of how securities are traded via broker-dealer networks.
OTC EQUITY MARKET
Marketplace where companies’ stock is not listed on an exchange.
BOND MARKET
Marketplace where investors buy debt securities that are brought to the market by government entities and/or corporations.
INTERBANK MARKET
Global network utilized by financial institutions to trade currencies or currency derivatives directly between themselves.
LONDON INTERBANK OFFERED RATE (LIBOR) SCANDAL
Scandal in which bankers at major financial institutions colluded with each other to manipulate the LIBOR.
TREASURY MARKET
Marketplace where governments raise money by issuing debt.
REPO MARKET
2-way intersection, with cash on one side and treasury securities on the other, in which one sells securities to the other and agrees to purchase back the assets at a higher price by a certain date.
COMMODITY MARKET
Where buying/selling/trading occurs on raw products of the primary economic sector, instead of manufactured products.
BIG OTC DERIVATIVES MARKET
Marketplace where financial contracts are not traded on an asset exchange and can be tailored to each party’s needs.
EXCHANGE-TRADED FUNDS (ETF) MARKET
Basket of securities that tracks the underlying index of investments such as stocks and bonds.
