Related Words

Base Interest Rate: Related: Benchmark interest rate.

Benchmark Interest Rate: Also called the base interest rate, it is the minimum interest rate investors will demand for investing in a non-Treasury security. It is also tied to the yield to maturity offered on the co . . . View Full Definition

Discount Rate: The discount rate is the interest rate the Federal Reserve charges on loans it makes to banks and other financial institutions. The discount rate becomes the base interest rate for most cons . . . View Full Definition

Outright Rate: Actual forward rate expressed in dollars per currency unit, or vice versa.

Overlay Strategy: A strategy of using futures for asset allocation by pension sponsors to avoid disrupting the activities of money managers.

Passive Portfolio Strategy: A strategy that involves minimal expectational input, and instead relies on diversification to match the performance of some market index. A passive strategy assumes that the marketplace wil . . . View Full Definition

Payment Rate: Generally, the amount paid per unit of production (i.e., bushel, pound, hundredweight) to each participating farmer for eligible production under commodity income and price support programs.

Ordinary Interest: Interest based on a 360-day year instead of a 365-day year, resulting in what can be a significant difference.

Open-Market Rates: Interest rates that are determined in the open market by supply and demand, as opposed to being set by the Federal Reserve Board.

Operating Rate: The percentage of total production capacity of a company, industry, or country that is being used.