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The Financial Encyclopedia provides up-to-date definitions and concepts and almost everything about finance, investment, financial markets, financial instruments and products including stocks, bonds, money market tools, derivatives, etc. It covers areas as vast as business and commerce, international finance, corporate finance, investing, personal finance, active trading, mutual funds, hedge funds, funds of funds, derivative markets, forex, banking, real estate and so on. Content is categorized into sections and subsections, each with its own focus and perspective. The encyclopedia contains more than 30,000 terms (and counting) covering everyday jargon and terminology of the financial world.
The following list gives a glimpse of latest definitions handpicked from different sections. For definitions on a particular topic, please navigate through the left-hand menu under either the "essential" tab or "advanced" tab.
Pips: Digits that are added to or subtracted from the fourth decimal place in a currency rate quote. For example, in 1.2246, the number “6” is a pip. It represents the smallest increment of exchange rate fluctuation. Some argue that the name “pips” is an abbreviation for percentage in points. It could also be the FX equivalent of basis points (bps or bips) as used by traders of bonds and other interest rate-based instruments. Nevertheless, the pip can be broken down into decimals or fractionals (which refer to one-tenth of a pip). The bid-ask spread could be 2.3 pips, meaning 2 pips and 3 decimals. Most currency pairs are quoted using five pips.
Mid-Swap: the reference rate which is used to calculate the premium that a bond buyer will pay. Adding a spread to a reference rate is one method to value a bond....