Cyber*School

The interest rate is periodically adjusted to current interest rates.

In the variable quotation, prices change constantly during a trading day.

A tender procedure whereby the counterparties bid both the amount of money they want to transact with the central bank and the interest rate at which they want to enter into the transaction. When making the allocation the bids with the higher interest rates are handled with priority until completion of the procedure proposed by the Central Bank total amount reached. The allocation can be done either by the Dutch method defined at the lowest interest rate level accepted (also called marginal rate) or after the American method to the individual bid rates. Contrary to variable rate tender: fixed rate tender

The yield is dependent on the amount of generated profit for the company.

statistical method to calculate value at risk (var) The variance/covariance method employs historical volatilities and correlations between the risk categories. Due to the fact that only the linear relation between a price change and the change of the value of the portfolio is considered, it is not possible to show the risk of options precisely. Other methods: monte carlo simulation and historical simulation

daily settlement of profits or losses, Thus it is guaranteed that there is no under- resp. over-securitisation of an open position.

risk factor of options, also called kappa expresses how much the price of an option changes if volatility increases by one percentage point e.g.: call EURUSD, premium 3.50 USD Ct, vega 0.25 meaning: if volatility increases by one percentage point (e.g. from 11% to 12%) the price of the option changes from 3.50 USD Ct to 3.75 USD Ct

(Venture Capital) equity capital that unlike a loan does not depend on collateral, but rather from the estimated return potential of the financed company.

see price spread

abbr. Volatility

measure of uncertainty for a random variable such as stock prices, FX-rates, interest rates etc. Volatility is similar to the statistical term standard deviation.

This is a protective mechanism to increase price continuity in both during the auction and during the continuous trading. A volatility interruption is triggered if the potential execution price of an order is outside the static price range or the dynamic price range.

The right of shareholders in the Annual General Meeting to vote for or against applications submitted. A share is usually a right to vote, but there are also non-voting preferred shares.

Wall Street is the name of a street that runs through the New York financial district and where the New York Stock Exchange (NYSE) is located. Wall Street is therefore a synonym for both the NYSE itself, as well as the economic heart of the US, the financial center of New York.

(Warrant). Like options warrants securitize the right to buy within or at the end of a certain period of time a specific underlying asset at a price known in advance or to sell. However, while options are strictly standardized, the warrants of each provider have different characteristics.

sum of counterparty risk weighted and instrument weighted assets

Similar dividend returns are calculated once a year and proved to the BMF, by a tax representative in the domestic country (bank or chartered accountant)

A deposit at a bank made by an institutional investor, a large business, another bank or an investment vehicle such as a mutual fund or pension. Wholesale deposits are usually large amounts of money, and wholesale clients are sometimes prioritized more highly than individual customers.

Proportion of shares, which is located at the systems operated by an exchange company markets in circulation and is divided into a number of investors.

The writer holds a short position in a particular option series. With a call, he has the obligation to sell the underlying at a fixed exercise price until the expiry date if the holder exercises the option. With a put he must buy the underlying asset to the expiration date if the holder exercises the option.