Cyber*School

v. zero-bond

see zero-coupon rate

v. zero-curve

bond without interim payments of interest,Zero-bonds are issued at a discount to the principal amount. The yield results from the difference between the issue price and the redemption value.

the yield which result from the investment in a zero-bond, if one holds it till maturity (yield-to-maturity),The advantage of investing in a zero-bond is that the calculated yield can be reached in reality because there is no re-investment-risk, due to the absence of interim coupon payments

The zero-curve shows the relation between the maturity and the zero-coupon rate.The zero-curve can be derived from the normal interest curve, by eliminating the interim interest payments.

The value with which off-balance positions are weighted, to calculate the required capital adequacy.

abbr. (US-) Generally Accepted Accounting Principles

french designation for bearish

frensh designation for bullish

see also asset-backed security

that share of a coupon of a bond which is entitled to seller,The payment of interest (the coupon) is effected to the bearer of bond. If the bearer has not held the bond for the entire interest-rate-period, a share of the payment of interest is entitled to the previous owner. This share is called accrued interest.

abbr. Association Cambiste Internationale

method of interest calculationthe number of days of the interest rate period are calculated as real calendar daysthe number of days of a year is assumed to be 360also known as: money market method and french method

method of interest calculationthe number of days of the interest rate period is calculated as real calendar daysthe number of days of a year is assumed to be 365

method of interest calculationboth the number of days of the interest period and the number of days of a year correspond to the real calendar days

The fund manager seeks to achieve a higher performance by deviations from the established benchmark than the benchmark.

Risk difference between the portfolio and the fixed benchmark.

A 30/360 day-count convention assumes there are 30 days in a month and 360 days in a year. This method is usually used in the money market and among the money market operations of the ESCB. It is also called euro interest rate method, French interest method or money market method.

(ACT / 365) Interest calculation method in which the number of days for the interest period are calculated as true (determined by the calendar) days (ACT). The number of days in a year is assumed to be 365. Also called English interest calculation method.