Every term, every issue
The Glossary.
If a word ever stopped you mid-sentence, it's probably here. Every term from every issue, searchable and sorted from A to Z.
All terms
- Annualize
- To scale a return or a cost up to what it would be over a full year, so figures covering different lengths of time can be compared.
- Appraisal arbitrage
- Buying shares in a company being taken private specifically to reject the deal price and ask a judge for more.
- Appraisal rights
- A shareholder's legal right to refuse a deal price and ask a judge to independently decide what the shares were worth.
- Backwardation
- When oil for delivery soon costs more than oil for delivery later — a classic signal the market is worried about supply right now.
- Basis point
- A finance unit where one basis point is 0.01%.
- Book value
- What an asset is recorded as being worth in a company's accounts. It can differ enormously from what a buyer will actually pay.
- Bookrunner
- The lead bank that organises an IPO, gauges demand, sets the price, and decides who receives shares. Goldman Sachs played this role for SpaceX.
- Books and records
- The internal company documents shareholders can legally demand to inspect. Delaware narrowed this in 2025.
- Brent crude
- The international benchmark price for oil, quoted in US dollars per barrel. It is used to price most of the world's traded oil.
- Carry trade
- Borrowing in a low-interest currency, such as the yen, and investing the money where it earns more, then keeping the difference.
- Carve-out
- When a large company sells off one of its divisions as a separate business, as Volkswagen is doing with Everllence.
- Chokepoint
- A narrow waterway that a large share of global trade must pass through; when one is threatened, everything that moves through it gets riskier and more expensive.
- Class action
- One lawsuit brought on behalf of an entire group of people harmed the same way, here all the shareholders cashed out in the deal.
- CME FedWatch tool
- A widely used tracker of what traders are betting the Federal Reserve will do at its next meeting, read from real money moving in the futures market rather than from opinion surveys.
- Confidential filing
- A private submission to financial regulators allowing companies to prepare for a public listing without disclosing financial details publicly until they choose to. It gives flexibility on timing.
- Conflict of interest (in litigation)
- When one party's two roles pull in opposite directions, such as a fund whose private case could benefit at the expense of the group it leads.
- Consensus estimate
- The average of Wall Street analysts' forecasts for a company's results and the bar a company is measured against.
- Consumer discretionary
- The part of the economy selling wants rather than needs. Most sensitive to higher prices because consumers can simply choose not to buy.
- Contango
- The opposite: when oil for later delivery costs more than oil for delivery soon. The more common shape, partly because storing oil costs money.
- Core inflation
- Inflation with volatile food and energy prices stripped out, used to see the underlying trend.
- Cost of carry
- The total cost of holding something until a future date, made up of the interest given up plus storage and insurance. It is the main reason a futures price sits above a spot price.
- Cost pass-through
- What a company does with a new cost like a tariff — either absorbing it into smaller profit or passing it to customers as a higher price.
- Currency intervention
- When a government or central bank steps directly into the market to push the value of its own currency up or down.
- Currency-neutral (constant currency)
- It's like measuring how much a business actually grew, pretending exchange rates didn't change at all.
- Data-dependent
- Deciding each meeting based on the latest figures rather than pre-committing to a path.
- De-anchoring of inflation expectations
- When people stop believing inflation will return to target and start expecting it to stay high, which can become self-fulfilling.
- Decentralized exchange (DEX)
- A trading platform that runs on a blockchain with no company in charge. It operates through code, around the clock, for anyone with an internet connection.
- Delaware Court of Chancery
- The specialist US court, with judges and no juries, where most major corporate disputes are decided, because most large US companies are legally incorporated in Delaware.
- Discount rate
- The interest rate used to calculate what future earnings are worth in today's money. When rates are high, future profits are worth less today, which puts extra pressure on companies valued on distant potential rather than current earnings.
- Discovery
- The stage of a lawsuit where each side can demand the other's internal documents and evidence.
- Discretionary spending
- The money people spend on wants rather than needs.
- Diversification
- Spreading your money across more assets so you are never overly dependent on any single one.
- Dovish
- When a central bank or its members prefer to keep interest rates low and money cheap to support growth. A dovish board member is less likely to vote for rate rises.
- Dry powder
- The money a private equity firm has raised from investors but not yet spent. A large stockpile lets a firm move quickly on big deals.
- Earnings surprise (beat/miss)
- The gap between reported results and the consensus estimate. Above the bar is a "beat," below it a "miss".
- Effective tariff rate
- The average tariff actually carried across everything the US imports, blended into one number, as opposed to any single headline rate.
- Emerging markets
- The economies of fast developing countries, which can offer higher growth than established ones but usually come with more risk.
- Equity (in a deal)
- The buyer's own cash put into a purchase, as opposed to the borrowed part.
- Excess structural capacity
- When an industry can produce much more than what is demanded, usually because governments have subsidized the building of factories.
- Exit
- The moment a private equity firm sells a company it owns, hopefully for more than it paid. It is when the firm collects its return.
- Exorbitant privilege
- The unique advantage the US gets from issuing the world's main reserve currency. Since the world always needs dollars, it can borrow more cheaply and easily than other countries.
- Expense ratio
- The annual fee an ETF charges you, taken automatically as a small percentage of what you've invested. Lower is better, but context matters for newer products.
- Extended (after-hours) trading
- Trading that happens outside normal market hours, often right after an earnings release.
- Fair value
- The judge-determined worth of shares in an appraisal case. It can come out above, at, or below the deal price.
- Fiduciary duty
- The legal obligation of directors and controlling insiders to act in shareholders' best interests rather than their own.
- Foreign exchange reserves
- The foreign currencies and assets a country holds to pay for imports and stabilize its own currency in a crisis.
- Futures contract
- An agreement to buy or sell something at a fixed price on a set future date.
- Gross margin
- The share of revenue left after the direct cost of making a product. A core read on profitability.
- Guidance
- A company's own forecast for its future results.
- Hawkish
- The opposite of dovish. When a central bank or its members prefer higher interest rates to control inflation, even if it slows growth. A hawkish stance means rates are more likely to rise.
- Higher for longer
- The idea that central banks will keep interest rates elevated for an extended period rather than cutting them soon.
- IEA (International Energy Agency)
- An intergovernmental body that tracks and forecasts global energy markets. Think of it as the energy world's equivalent of the OECD.
- Import duty
- Another name for a tariff.
- Index inclusion
- When a company joins a major index like the S&P 500, passive funds automatically buy its shares regardless of any individual investor's view on the company.
- Inflationary
- Something that pushes the general level of prices up. A tariff is inflationary because it raises the cost of imported goods.
- Interest rate differential (the rate gap)
- The difference between two countries' interest rates. It is one of the main forces driving where global money flows.
- IPO (Initial Public Offering)
- When a private company sells shares to the public for the first time.
- Labor force participation rate
- The share of working age people either working or looking for work. If people stop looking, the unemployment rate can fall without anyone finding a job.
- Lead plaintiff
- The investor chosen to steer a class action. Picks the lawyers, sets strategy, and can agree settlements that, once approved by the court, bind everyone in the class.
- Leverage
- Using borrowed money to make a bigger purchase than your own cash alone would allow. It magnifies both the potential gain and the potential loss.
- Leveraged buyout (LBO)
- Buying a company using mostly borrowed money, with the company itself acting as security for the loan.
- Leveraged loan
- A loan to a company taking on a lot of debt, such as in a buyout. Because the borrower is riskier, it pays a higher interest rate.
- Market capitalization
- The total value of a company, found by multiplying its share price by the number of shares in existence. SpaceX's sits near $2.1 trillion.
- Market repricing
- When new information causes asset values to drop quickly across the board — stocks fall and borrowing gets more expensive.
- Maturity (or tenor)
- The specific length of time until a bond expires and the borrower has to pay back the original loan amount in full.
- Medium-term target
- The 2% inflation goal the ECB aims to reach over a couple of years, not necessarily every single month.
- Merger arbitrage
- Buying shares after a deal is announced to profit from the small gap between the market price and the deal price.
- MoU (Memorandum of Understanding)
- A preliminary, non-binding agreement that sets out the framework for a possible deal. It is not final and not yet legally locked in.
- Multipolar monetary system
- A world where no single currency dominates, and several share the role the dollar plays alone today.
- Nonfarm payrolls
- The monthly count of how many jobs the US economy added or lost, excluding farm work. One of the most closely watched numbers in global markets.
- Non-yielding asset
- Something that pays no interest or dividend while you hold it, such as gold. Its entire return has to come from the price rising.
- OMFIF
- The Official Monetary and Financial Institutions Forum, a London based institution that works directly with the world's central banks and public funds and publishes an annual survey of their intentions.
- One-off
- A gain or cost that will not repeat, like a tax refund or a legal settlement.
- Opportunity cost
- What you give up by choosing one thing over another. Holding an asset that pays nothing means giving up the interest that money could have earned instead.
- Perpetual futures
- A contract that lets you bet on where a price is going with no expiry date. Common in crypto and used on Hyperliquid to trade oil and other assets 24/7.
- Price discovery
- The process by which public markets determine the real value of a company through actual buying and selling.
- Price-to-earnings (P/E) ratio
- A share price divided by earnings per share. How many dollars investors pay for each dollar of annual profit.
- Private equity
- Investors who buy companies not listed on the stock market, work to make them more valuable, and sell them on later for a profit.
- Private markets
- The part of investing that happens off the public stock exchange, such as buying whole companies or large stakes in them.
- Purchasing managers' index (PMI)
- A monthly survey of business managers used as an early read on economic activity.
- Quality of earnings
- How much of a profit comes from the actual business versus one-off boosts. High quality is durable and low quality flatters.
- Reflationary stance
- keeping money cheap and stimulus flowing to push growth and inflation up, even if it leaves the currency soft.
- Reported vs adjusted earnings
- Reported earnings include everything. Adjusted, or underlying, earnings remove the one-off items.
- Reserve currency
- A currency that governments and central banks hold in large amounts to settle international trade and store national wealth.
- Retail vs institutional investors
- Retail investors are everyday individuals. Institutional investors are large funds. The two often receive very different allocations in a hot IPO.
- Retaliation (Trade)
- When a country hit by tariffs responds by taxing the other country's exports in return, which can widen a trade dispute.
- Revenue multiple
- A way of measuring how expensive a company is relative to how much money it brings in. The higher the multiple, the more faith the market is placing in future growth.
- Revenue vs profit
- Revenue is the total money coming in. Profit is what remains after all costs are paid. A company can have very high revenue and still lose money, which is the case for all three companies here.
- Revision
- The correction applied to an economic figure after it is first published, as fuller records arrive and seasonal adjustments are recalculated. The first number is an estimate, not a final count.
- Risk-off
- When investors get nervous and move into safe assets like gold and government bonds, and out of stocks and emerging markets.
- Seasonal adjustment
- A statistical smoothing that strips out predictable yearly patterns, like school terms or holiday hiring, so the underlying trend is visible.
- Second-round effects
- When an initial price shock, like energy, feeds into wages and other prices, so inflation keeps going even after the original cause fades.
- Section 122 (Trade Act of 1974)
- A hard-stop emergency tariff tool. A maximum of 150 days, extendable only by an Act of Congress.
- Section 301 (Trade Act of 1974)
- A longstanding tariff authority that runs on a four-year cycle and can be renewed on request more or less indefinitely, with no cap on the rate.
- Selling-price expectations
- Surveys of whether businesses plan to raise their prices soon. A forward-looking inflation signal.
- Services inflation
- Price rises in services like rent, insurance, and travel rather than physical goods. Tends to be stickier than goods inflation.
- Sovereign wealth fund
- A state-owned investment fund that invests a country's surplus money around the world.
- Spot price
- The price for buying something now, for immediate delivery.
- Stagflation
- A combination of slow economic growth and rising inflation at the same time — cutting rates helps growth but worsens inflation, and vice versa.
- Statutory interest (appraisal)
- The interest Delaware adds to an appraisal award by default: 5% over the Federal Reserve discount rate, compounded quarterly, from deal close to payment.
- Strait of Bab al-Mandab
- The narrow strait at the southern entrance to the Red Sea and it became oil's detour route after Hormuz was disrupted.
- Supply side shock
- Prices rising because supply is disrupted, not because people are spending more. Interest rates can't fix a blocked shipping lane.
- Surged
- When an asset rises sharply and quickly in price. In this context, if the yen surged it would mean the currency jumped higher rapidly, catching anyone on the wrong side of the carry trade off guard.
- Tailwind
- Something that works in your favour and helps push a result in a positive direction. In finance, a tailwind is any factor that supports the performance of an asset, currency, or economy. The opposite is a headwind.
- Take-private (going private)
- A buyer purchases all the shares of a listed company and removes it from the stock exchange entirely.
- Tariff
- A tax a country charges on goods coming in from abroad. Paid by the company importing them, not by the exporting country.
- Tariff incidence
- Who actually ends up worse off once a tariff is paid, which can be the importing company, its customers, or the foreign supplier.
- Technical breakout
- When a price finally moves past a level it has repeatedly failed to clear. A description of past behavior, not a guarantee of future behavior.
- Tender offer
- When a company allows employees or early investors to sell their shares to private buyers before a public listing. It provides liquidity without requiring an IPO first.
- Token buyback
- When a crypto platform uses its own revenue to purchase and retire its tokens. The same logic as a company buying back its own shares to return value to holders.
- Top-up tariffs
- Additional duties layered on top of existing ones to lift the overall tariff level back to a previous point.
- USMCA
- The United States-Mexico-Canada Agreement, a regional trade deal. Goods it covers are largely exempt from these new tariffs.
- Valuation
- The estimated total value of a company. In private markets this is set in funding rounds by a small group of investors. In public markets it is set in real time by actual buying and selling.
- Voting rights vs economic stake
- Voting rights decide who controls a company's decisions. An economic stake is how much of its profits and value you own.
- Wholesale vs direct-to-consumer
- Selling through other retailers (wholesale) versus selling straight to shoppers via own stores and apps (direct).
- Written consent
- Approving a corporate decision on paper using existing voting power, without holding a shareholder meeting or vote.
- WTI (West Texas Intermediate)
- The US benchmark oil price and usually trades slightly below Brent and moves with it.
- Yield curve
- A financial chart that plots the interest rates of bonds with the same credit quality across different lengths of time, spanning from short-term borrowing to long-term debt.
- Yield curve flattening
- When short and long-term interest rates move closer together, usually a sign markets expect slow growth ahead.
- Yield differential
- The gap between two countries' bond yields, and the key number behind the yen's weakness this week.
- Yield on government bond
- The return an investor earns for lending to the government, and it tends to fall when inflation worries cool.
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