Glossary of Derivatives-Related Terms1
The amount of coupon interest income accumulated on a coupon-bearing bond since the last coupon payment date.
all-or-none (AON) order
An order that must be filled in its entirety or not at all.
See American-style option.
An option that can be exercised at any time up to and including the expiration day.
A swap whose notional principal decreases through time.
A hedge placed in anticipation of making a transaction in spot market on future date (e.g., a breakfast cereal producer may want to lock in the price of the grain that he needs three months from now).
The simultaneous purchase or sale of perfect substitutes at different prices.
Someone who engages in arbitrage.
Same as arbitrager.
An option whose payoff is determined by the average price of asset during specified period.
The price at which a market maker stands ready to sell.
The investment decision regarding how to allocate funds across different asset categories (e.g., stocks, bonds, commodities, real estate).
An option whose payoff is the underlying asset contingent on the underlying asset price being greater than or less than the critical price.
The procedure by which option seller is notified of buyer's intention to exercise.
An option whose exercise price is approximately ...