Alphabetical - P

PackageA derivative that is a portfolio of standard calls and puts, possibly combined with a position in forward contracts and the asset itself.
PARThe nominal value of a security, for example $1000 for US treasury bonds or £100 for UK government bonds
Par Frequency??
Par ValueThe principal amount of a bond
Par YieldThe coupon on a bond that makes its price equal the principal.
Parallel ShiftA movement in the yield curve where each point on the curve changes by the same amount.
Partially Unwound??
PassiveOften used to refer to long only investment
Path-Dependent OptionAn option whose payoff depends on the whole path followed by the underlying variable - not just its final value.
PayoffThe cash realised by the holder of an option or other derivtaive at the end of its life.
PB RatioPrice/Book ratio
PE RatioPrice/Earnings ratio - Ratio of share price to earnings after tax
Pension FundsThe groups that administer pensions schemes.
PerpetualA security without time limit for redemption
Perpetuity??
Physical??
PIBORParis Interbank Offered Rate
PIKPayment in Kind (pic payment)
PlacingA method of bringing a company to the market.
Plain VanillaA term used to describe a standard deal
Portfolio ImmunizationMaking a portfolio relatively insensitive to interest rates.
Portfolio InsuranceEntering into trades to ensure that the value of a portfolio will not fall below a certain level.
Position LimitThe maximum position a trader (a group of traders acting together) is allowed to hold.
PPPPurchasing Power Parity
Preference ShareDividend is paid as a fixed percentage.
PremiaThe plural of risk premium.
Premium Bond??
Prepayment FunctionA function estimating the prepayment of principal on a portfolio of mortgages in terms of other variables.
Pre-Refunded??
Primary MarketMarkets where securities are sold when first issued.
Prime Broker??
PrincipalThe par or face value of a debt instrument.
Principal OnlyA mortgage backed security where the holder receives only principal cash flows on the underlying mortgage.
Private BankingSpecialist banking services for high net worth individuals
PrivatisationConversion of a state run company to a public limited status.
Program TradingA procedure where trades are automatically generated by a computer and transmitted to the trading floor of an exchange.
Promissory NoteA signed promise to pay a sum of money
Prospective DividendThe dividend which has been forecast for its current yield
Protective PutA put option combined with a long position in the underlying.
PSBR??
Purchasing Power ParityThe belief that inflationary differentials between countires are the long-run determininants of currency movements.
Put Bonds??
Put Option??
Put-Call ParityThe relationship between the price of a European call option and the price of a European put option when they have the same strike price and the same maturity date.
Puttable BondA bond where the holder has the right to sell it back to the issuer at certain predetermined times for a predetermined price.
Puttable SwapA swap where one side has the right to terminate early.
Package
A derivative that is a portfolio of standard calls and puts, possibly combined with a position in forward contracts and the asset itself.
PAR
The nominal value of a security, for example $1000 for US treasury bonds or £100 for UK government bonds
Par Frequency
??
Par Value
The principal amount of a bond
Par Yield
The coupon on a bond that makes its price equal the principal.
Parallel Shift
A movement in the yield curve where each point on the curve changes by the same amount.
Partially Unwound
??
Passive
Often used to refer to long only investment
Path-Dependent Option
An option whose payoff depends on the whole path followed by the underlying variable - not just its final value.
Payoff
The cash realised by the holder of an option or other derivtaive at the end of its life.
PB Ratio
Price/Book ratio
PE Ratio
Price/Earnings ratio - Ratio of share price to earnings after tax
Pension Funds
The groups that administer pensions schemes.
Perpetual
A security without time limit for redemption
Perpetuity
??
Physical
??
PIBOR
Paris Interbank Offered Rate
PIK
Payment in Kind (pic payment)
Placing
A method of bringing a company to the market.
Plain Vanilla
A term used to describe a standard deal
Portfolio Immunization
Making a portfolio relatively insensitive to interest rates.
Portfolio Insurance
Entering into trades to ensure that the value of a portfolio will not fall below a certain level.
Position Limit
The maximum position a trader (a group of traders acting together) is allowed to hold.
PPP
Purchasing Power Parity
Preference Share
Dividend is paid as a fixed percentage.
Premia
The plural of risk premium.
Premium Bond
??
Prepayment Function
A function estimating the prepayment of principal on a portfolio of mortgages in terms of other variables.
Pre-Refunded
??
Primary Market
Markets where securities are sold when first issued.
Prime Broker
??
Principal
The par or face value of a debt instrument.
Principal Only
A mortgage backed security where the holder receives only principal cash flows on the underlying mortgage.
Private Banking
Specialist banking services for high net worth individuals
Privatisation
Conversion of a state run company to a public limited status.
Program Trading
A procedure where trades are automatically generated by a computer and transmitted to the trading floor of an exchange.
Promissory Note
A signed promise to pay a sum of money
Prospective Dividend
The dividend which has been forecast for its current yield
Protective Put
A put option combined with a long position in the underlying.
PSBR
??
Purchasing Power Parity
The belief that inflationary differentials between countires are the long-run determininants of currency movements.
Put Bonds
??
Put Option
??
Put-Call Parity
The relationship between the price of a European call option and the price of a European put option when they have the same strike price and the same maturity date.
Puttable Bond
A bond where the holder has the right to sell it back to the issuer at certain predetermined times for a predetermined price.
Puttable Swap
A swap where one side has the right to terminate early.

© 2022 Better Solutions Limited. All Rights Reserved. © 2022 Better Solutions Limited Top