Cyber*School

A professional association of bond dealers. The members consist of over 350 various financial conglomerates and institutions that actively trade bonds. The association makes recommendations pertaining to bond dealing rules to the regulators of various European countries.

Call as well as Puts lie at the money if the strike price and the exchange rate of the underlying are equal.

An option is at-the-money if the spot price of the underlying is approximately equal to the strike price.

abbr. Austrian Traded Index

A trading model of the market model of a exchange in which the orders are collected and there is a concentration of liquidity. The price will be determined according to the principle of executing.

The new version of the act regulating banking and credit business, which entered into force on 1 January 1994. The Banking Act is the central legal norm on banks in Austria.

The Austrian Control Bank public limited company is Austria's main financial and information service provider for export economy and capital markets. Owners of the specialist company founded in 1946, are domestic commercial banks. The wide range of services are available to companies, financial institutions and organizations of the Republic of Austria.

The Austrian National Bank is the central bank of the Republic of Austria and as an integral part of the European System of Central Banks (ESCB) or the Eurosystem. It helps to form the economic development in Austria and in the euro area in the public interest. It is a stock company in accordance with the National Bank Act from 1984 and subject to (compared to other corporations) a number of specific arrangements arising from their special status as a central bank. The registered capital of 12 million euros belongs 70% to the state and 30% to the interest groups as well as banks and insurance companies.

The Vienna Stock Exchange is the oldest stock exchanges in the world and was founded in 1771 by Empress Maria Theresa. In 1997, the Securities Market of the Vienna Stock Exchange was merged with the futures exchange of the Austrian Futures and Options Exchange to the new Wiener Börse AG. The Vienna Stock Exchange specializes in Austrian and Central and Eastern European investment types.

(ATX) The ATX is a real-time (Real-time index) calculated price index that covers the blue-chip segment of the Austrian stock market and contains the 20 most liquid shares on the Vienna Stock Exchange and was developed by the Vienna Stock Exchange. The shares are weighted according to their market capitalization therefore values with a high capitalization have a stronger influence on the ATX. The starting point for the calculation of the ATX is the 2nd January in 1991 with 1,000 points.

By resolution of the Annual General Meeting to the Board for a maximum of five years granted authorization without further questioning of the annual general meeting to increase the share capital by issuing new shares to a certain extent.

(ARCH). The ARCH model which was developed in the 80s by Robert F. Engle, originally described the development of the volatility. It is based on the assumption that the variance of the random error models depend of realized random errors of the previous period, so that large and small errors tend to occur in groups. The results are often used for risk measurement. For the development of ARCH models Robert F. Engle was awarded with the Nobel Prize in Economics in 2003

also serial correlationThe correlation between a time series of observations, such as interest rates, and the same values at a fixed time interval later. A time series is autocorrelated if future returns are correlated with past returns.

abbr. Added Value on Equity

Credit exposure arising from market-driven instruments such as interest rate swaps has an ever-changing mark-to-market exposure. This can be projected because it is dynamic and it is possible to estimate an average exposure in each period. Such a projection would be a probability-weighted aggregation across all potential market rate paths.

the average interest rate is calculated as a term-weighted arithmetic average of interest rates of serveral periods, compound interest are not considered

v. Bankers Acceptance

the ex post comparison of the calculated risk and the effectively occured changes of the value of a portfolio, Back testing as well as stress testing methods are essential supplements to value at risk calculations such as variance/covariance method, monte carlo simulation and historical simulation

Backwardation is a market condition where spot rates exceed forward rates. The term is common in commodity markets and corresponds to the term discount in FX-markets. In the energy markets, the prevailing condition may reflect supply and demand. For example, if the crude oil market is at backwardation, it may indicate a lack of immediately available supply. Contango is the opposite.

Name for a longer lasting exchange phase, which is characterized by regular price losses. Derives from the French word baisser = drop,descend. Contrary bull market.