Glossary

Don’t get lost in all that Stock Exchange stuff…keep the faith, the bass guitar and the Fred Perry.

—Phil Broadhurst, The Mighty Utterance, 1989

Amortizing    A financial instrument whose nominal principal amount decreases in size during its life.

Arbitrage    The process of buying securities in one country, currency or market, and selling identical securities in another to take advantage of price differences. When this is carried out simultaneously, it is in theory a risk-free transaction. There are many forms of arbitrage transactions. For instance, in the cash market a bank might issue a money market instrument in one money centre and invest the same amount in another centre at a higher rate, such as an issue of 3-month US dollar ...

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