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E:
Easing:
Modest decline in price.
ECB--European Central Bank:
The Central Bank for the new European Monetary Union.
Echo Watchers Survey:
The Economy Watchers Survey asks business-cycle sensitive workers their thoughts on existing and future economic conditions, giving a detailed picture of economic trends in Japan . The survey is based on questionnaires from 'man on the street' sectors that are particularly vulnerable to business cycle turns. These segments of the economy include sectors such as retail, restaurant service, and taxi driving. With this combined data the Japanese Eco Watchers report serves as both a consumer confidence indicator and a leading indicator for the rest of the economy. The report is usually released less than two weeks after the reporting month, thus its statistics are usually very timely. The headline number is released where 50 represents the center midpoint line of boom/bust sentiment.
Economic Exposure:
The risk on a company's cash flow arising from foreign exchange fluctuations
Economic and Monetary Union - EMU:
An economic and monetary union is a single market with a common currency. It is to be distinguished from a mere currency union (e.g. the Latin Monetary Union in the 1800s), which does not involve a single market.
The largest economic and monetary union at present is the Eurozone. The Eurozone consists of the European Union member states that have completed the third stage of the EMU by adopting the Euro. Some non-EU members have also adopted the Euro, but they are not part of this EMU
Economic Exposure:
Reflects the impact of foreign exchange changes on the future competitive position of a company in the sense of the impact it can have on the future cash flows of the company. An exposure to fluctuating exchange rates, which affects a company's earnings, cash flow and foreign investments. The extent to which a company is affected by economic exposure depends on the specific characteristics of the company and its industry.
Economic Indicator:
A government issued statistic that indicates current economic growth and stability. Common indicators include employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.
Economy - Overheated:
Is an economy on a high growth rate trajectory placing pressure on the production capacity resulting in increased inflationary pressures and higher interest rates.
ECP-Eurocommercial Paper:
An unsecured, short-term loan issued by a bank or corporation in the international money market, denominated in a currency that differs from the corporation's domestic currency.
For example, if a U.S. corporation issues a short-term bond denominated in Canadian dollars to finance its inventory through the international money market, it has issued eurocommercial paper.
ECU:
European Currency Unit.
ECU - European Currency Unit:
A basket of the member currencies. As a composite unit, the ECU consists of all the European Community currencies, which are individually weighted. It was created by the European Monetary System with the eventual goal of replacing the individual European member currencies.
EDI:
Electronic Data Interchange.
Efficient Market Theory:
The theory that the current market price reflects all information and expectations regarding the currency pair in question. The theory also assumes that the market cannot overprice or underprice an asset, and hence the current price is the correct valuation at the time.
Efficient Markets:
Markets where assets are traded in which the price is indicative of all current and relevant information and thus it is impossible to have undervalued assets.
EFT:
Electronic Fund Transfer.
EIA Natual Gas Report:
The Energy Information Administration (EIA) provides weekly information on natural gas stocks in underground storage for the U.S., and three regions of the country. The level of inventories help determine prices for natural gas products.
EIA-Energy Information Administration:
Energy Information Administration
The Energy Information Administration (EIA), as part of the U.S. Department of Energy, collects and disseminates data on energy reserves, production, consumption, distribution, prices, technology, and related international, economic, and financial matters. Coverage of EIA's programs includes data on coal, petroleum, natural gas, electric, and nuclear energy.
Elliot Wave Theory:
A theory based on the notion that the market moves in waves, which consist of trends followed by partial corrections. The Elliot Wave Theory states that there are 5 waves within an overall trend.
Empire State Manufacturing Survey - United States:
The New York Fed conducts this monthly survey of manufacturers in New York State. Participants from across the state represent a variety of industries. On the first of each month, the same pool of roughly 175 manufacturing executives (usually the CEO or the president) is sent a questionnaire to report the change in an assortment of indicators from the previous month. Respondents also give their views about the likely direction of these same indicators six months ahead. This index is seasonally adjusted using the Philadelphia Fed's seasonal factors because its own history is not long enough with data only going back a couple of years. (Federal Reserve Bank of New York)
employment cost index:
A closely watched economic report by the Bureau of Labor Statistics that indicates the total cost of employing a civilian worker. A larger-than-expected increase in the index is likely to place downward pressure on both bond and equity prices.
Employment Level - Switzerland:
The number of paid employees working at least six hours each week. The headline number for the employment level, which is officially known as "workforce jobs," appears as both the total number of employees and as a year on year percentage change in that figure. The Swiss employment level is important serving as the headline figure for job growth or decline. Higher job growth accompanies economic expansion and could spark inflationary pressures. Swiss unemployment has historically been very low, averaging half that of the EU. Whereas most countries consider an unemployment rate of 4% very low, Switzerland is accustomed to rates below 4%. Relevance : Rarely affects markets
EMS:
European Monetary System
A system designed to stabilize if not eliminate exchange risk between member states of the EMS as part of the economic convergence policy of the EU. It permits currencies to move in a measured fashion (divergence indicator) within agreed bands (the parity grid) with respect to the ECU and consequently with each other.
EMU:
European Monetary Union
EMU (Economic and Monetary Union):
Economic and Monetary Union
End Of Day Order - EOD:
An order to buy or sell at a specified price. This order remains open until the end of the trading day which is typically 5PM ET.
Entrepot:
A term used for international trade where goods are shipped to a centre for re-export. Hong Kong engages in significant amounts of this form of trade.
Envelopes:
While Bollinger Bands place boundary lines based on standard deviation, envelopes place lines at fixed percentage points above and below a moving average line. The upper and lower limits specify entry and exit points for currency traders.
EOD - End Of Day Order:
An order to buy or sell at a specified price. This order remains open until the end of the trading day which is typically 5PM ET.
EOE:
European Options Exchange.
Equilibrium:
A price region that suggests a balance between demand and supply for an currency pair in the marketplace.
Equipment Investment - Germany - Euro-zone:
Measures the total value of German investments in equipment including machinery and construction equipment. Equipment Investment is a part of GDP and released at the same time, therefore changes in the figure directly change overall GDP. But Equipment Investment is also an early indicator for production since companies generally make capital expenditures in a healthy economy when the need to expand operational productivity exists. Because such capital expenditures are sensitive to business conditions, the report can also forecast economic growth or recession. The headline number is the percentage change in Equipment Investment in the reporting quarter.
equity market:
The market in which shares are issued and traded, either through exchanges or over-the-counter markets. Also known as the stock market, it is one of the most vital areas of a market economy because it gives companies access to capital and investors a slice of ownership in a company with the potential to realize gains based on its future performance.
This market can be split into two main sectors: the primary and secondary market. The primary market is where new issues are first offered. Any subsequent trading takes place in the secondary market.
ERM:
Exchange Rate Mechanism.
Euro:
The common currency adopted by eleven European nations(Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal) on January 1, 1999.
Eurobond:
A long-term loan issued in a currency other than that of the country or market in which it is issued. Interest is paid without the deduction of tax.
Euroclear:
One of the leading clearing systems for eurobonds.
Eurodollar:
US currency or funds held in banks outside the US—in Europe or anywhere else. Eurodollars are used commonly for settling international transactions.
European Monetary Union:
An institution of the EU, whose primary goal is to establish a single currency (the euro) for the entire EU.
European Monetary Union - EMU:
The principal goal of the EMU is to establish a single European currency called the Euro, which will officially replace the national currencies of the member EU countries in 2002. On Janaury1, 1999 the transitional phase to introduce the Euro began. The Euro now exists as a banking currency and paper financial transactions and foreign exchange are made in Euros. This transition period will last for three years, at which time Euro notes an coins will enter circulation. On July 1,2002, only Euros will be legal tender for EMU participants, the national currencies of the member countries will cease to exist. The current members of the EMU are Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal.
European Union:
The group formerly known as the European Community.
Exchange Rate Risk:
The risk that a business' operations or an investment's value will be affected by changes in exchange rates. For example, if money must be converted into a different currency to make a certain investment, changes in the value of the currency relative to the American dollar will affect the total loss or gain on the investment when the money is converted back. This risk usually affects businesses, but it can also affect individual investors who make international investments.
Exchange control:
Rules used to preserve or protect the value of a country's currency.
Exchange Rate Risk:
The potential loss that could be incurred from an adverse movement in exchange rates.
Execution:
The Process of completing an order or deal.
exercise:
When an option or warrant holder takes up his or her option to buy or sell the underlying instrument (for example shares, commodities, an index etc) he/she is said to exercise the option or warrant.
Exercise (options):
The owner of an option contract may exercise it, indicating that the financial transaction specified by the contract is to be enacted immediately between the two parties, and the contract itself is terminated. When exercising a call, the owner of the option purchases the underlier at the strike price from the option seller, while for a put, the owner of the option sells the underlier to the option seller.
Exercise Notice:
A formal notification that the holder of an option wishes to exercise it by buying or selling the underlying stock at the exercise price.
Exercise Price - Strike Price:
The price at which an option can be exercised.
Exotic:
A foreign exchange term for a thinly traded currency. Exotic currencies are illiquid, lack market depth and trade at low volumes. Trading an exotic currency can be expensive, as the bid-ask spread is usually large.
Exotics are not considered major currencies because they are not easily traded in a standard brokerage account. Major currencies include the U.S. dollar, eurodollar, Canadian dollar and Swiss franc. Examples of exotic currencies include the Thai baht, Uruguay peso or Iraqi dinari.
Expansion:
Growth, as in an economic recovery.
Expiration Date:
(1) Options - the last date after which the option can no longer be exercised. (2) Bonds-the date on which a bond matures.
Expiration Month:
The month in which an option expires.
Expiry Date:
The last day on which the holder of an option can exercise his right to buy or sell the underlying security.
Exponentially Weighted Moving Average - EMA:
While the simple moving average distributes weight equally across the data series, exponentially weighted moving averages place greater weight to more recent data. As a result, they tend to provide a faster signal.
Exposure:
In foreign exchange, a potential for gain or loss because of movement in foreign exchange rate.