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Investment Banking Jargon > Morgan Stanley > Flashcards

Morgan Stanley Flashcards

1
Q

Acquisition

A

One company taking over the controlling interest of another company.

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2
Q

Alternative Investment

A

Investment vehicles that can be anything from hedge funds to private equity funds, managed futures, real estate, etc.

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3
Q

Analyst

A

An entry-level point for graduates in the Firm; in Research, this can also refer to a senior employee in the Research Division.

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4
Q

Assets

A

The various resources that an individual or organisation owns.

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5
Q

Bear

A

An investor who expects prices to fall.

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6
Q

Bid/Ask

A

A pair of prices, where “bid” is the price at which a trader is prepared to buy and “ask” is the price at which a trader is prepared to sell a security.

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7
Q

Block Trade

A

A trade that involves a large quantity of stock (ie 10,000 shares or more).

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8
Q

Bond

A

A loan that entails a promise by a corporate municipal, or government entity to repay a borrowed amount (“principal”) on a particular date (“maturity”) at an agreed upon interest rate along with a fixed-coupon payment.

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9
Q

Bull

A

An investor who expects prices to rise.

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10
Q

Capital

A

Material wealth used or available for use in the production of more wealth.

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11
Q

Capital Market

A

The market for the purchase and sale of medium and long-term financial instruments, including bonds, notes, swaps and equities.

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12
Q

Central Bank

A

State Institutions, typically independent of the government, which take care of issuing currency, setting interest rates and controlling inflation.

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13
Q

Chinese Wall

A

Imaginary barrier restricting the flow of information between the Public side of the business and the Private side.

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14
Q

Commodities

A

Raw materials, such as precious metals or grains, for which contracts are bought and sold on commodities exchanges.

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15
Q

Common Stock

A

A class of stock, usually having voting power, conferring residual ownership of assets of a corporation after all liabilities gave been satisfied. Known as ordinary share capital in the UK.

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16
Q

Controllers

A

The department within a firm that oversees financial accounts and transactions.

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17
Q

Convertible bonds

A

Corporate securities (usually preferred shares or bonds) that are exchangeable for a set number of another form (usually common shares) at a fixed price.

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18
Q

Coupon

A

The interest that a borrower promises to pay the holder of a bond.

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19
Q

Derivatives

A

A contract whose value is based on the performance of an underlying financial asset, index, or another instrument (i.e. options and futures on various securities or commodities).

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20
Q

DCF

A

Abbreviation for discounted cash flow analysis, a method used to value a project, company, or financial asset.

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21
Q

DCM

A

Abbreviation for Debt Capital Markets, a group within Global Capital Markets.

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22
Q

Due Diligence

A

An analysis that aims at preventing harm to both parties involved in a transaction by reviewing financial records.

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23
Q

ECM

A

Abbreviation for Equity Capital Markets, a group within Global Capital Markets.

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24
Q

ED

A

Abbreviation for Executive Director, a mid-senior-level manager.

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25
Q

Equity

A

The monetary value of the ownership of an investment.

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26
Q

Equity Research

A

Analysts in Equity Research focus on understanding the fundamentals of the economy, an industry, or an individual business to assist the Firm’s clients in making sound investment decisions.

27
Q

FCA

A

Abbreviation for Financial Conduct Authority.

28
Q

FIG

A

Abbreviation for Financial Institutions Group.

29
Q

Fixed Income

A

Bonds, bills, and interest bearing notes that pay a specific interest rate over the life of a loan.

30
Q

Flotation

A

Issuing new shares or stocks.

31
Q

Forward

A

This is an agreement between two parties to buy or sell an asset at a specified price or given date.

32
Q

FSG

A

Abbreviation for Financial Sponsors Group, an industry group within the Investment Banking Division.

33
Q

Future

A

A standardised contract traded on an exchange. This is an agreement between two parties to buy or sell an asset at a specified price on a given date.

34
Q

FX

A

Abbreviation for foreign exchange.

35
Q

GCM

A

Abbreviation for Global Capital Markets.

36
Q

Hedge Fund

A

A type of fund focused on absolute, rather than relative, performance. It is allowed to short stocks (sell stock before you own it) and can use financial leverage.

37
Q

IPO

A

Abbreviation for initial public offering, the inaugural issuance of stock or other securities by a company for sale to the public.

38
Q

Issue

A

Financial securities that are made available for sale.

39
Q

LAF

A

Abbreviation for Leveraged Acquisition Finance, a group within GCM.

40
Q

LBO

A

Abbreviation for leveraged-buy-out, a strategy involving the acquisition of another company using a significant amount of borrowed money (bonds or loans) to meet the cost of acquisition.

41
Q

Liquid

A

An asset is liquid if it is relatively easy to find a buyer or seller for it.

42
Q

M&A

A

Abbreviation for Mergers & Acquisitions Department within the investment banking division.

43
Q

Merger

A

A consolidation where the combined net assets of two or more companies form a new company.

44
Q

Option

A

An investor’s right to purchase or sell a security or commodity on a specific date or predetermined price. The investor forfeits the instrument if they don’t exercise the options by the expiration date.

45
Q

PIB

A

Abbreviation for Public Information Book.

46
Q

Plain Vanilla

A

A simple, straightforward financial product without any unusual characteristics.

47
Q

Private Equity

A

Equity capital invested in a private company that has demonstrated operational excellence, sound long-term strategies and attractive growth potential.

48
Q

Privatisation

A

The process of converting a publicly or government owned enterprise into a privately owned and operated entity.

49
Q

Proprietary Trader

A

A trader that creates direct profit and risk exposure for the bank by taking positions, as opposed to trading for a client and charging commission.

50
Q

PWM

A

Abbreviation for private wealth management.

51
Q

Recapitalisation

A

Alteration of corporation’s capital structure, such as exchanging a proportion of debt or equity. Bankruptcy is a common reason for recapitalisation.

52
Q

Research Analyst

A

A senior member of equity research.

53
Q

Risk

A

The always-present chance of losses or other negative consequences as a result of investment.

54
Q

Salesperson

A

In the financial world, a person whose job is to sell securities for brokers, dealers and corporations.

55
Q

Sales Trader

A

Facilitates the execution of the customer’s orders and acts as the liaison between the firm’s traders and institutional traders. This role focuses on the short-term “story and flow” dealings.

56
Q

Securities

A

Typically, stocks and bonds.

57
Q

Securitisation

A

The process of distributing risk by aggregating debt instruments in a pool and issuing new securities backed by the pool.

58
Q

Spot Market

A

A commodities market where goods sell for cash and get immediately delivered.

59
Q

Stock

A

An investor’s ownership of a portion of a corporation.

60
Q

Syndicate

A

A group of investment banks that spread the risk of a new issue by jointly underwriting and distributing a new security offering.

61
Q

TMT

A

Abbreviation for technology, media and telecoms.

62
Q

Tombstone

A

A print advertisement in the financial press that announcements a securities offering.

63
Q

Trader

A

A professional who purchases and sells securities for brokers, dealers , and his or her own accounts.

64
Q

Yield

A

The return on a security expressed as a proportion of its price.

Investment Banking Jargon (5 decks)

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