Business / Finance Glossary

Lock-Up Option: Often used in risk arbitrage. Privilege offered a white knight (friendly acquirer) by a target company to buy crown jewels or additional equity. The aim is to discourage a hostile takeover. . . . View Full Definition

Lockbox: A collection and processing service provided to firms by banks, which collect payments from a dedicated postal box to which the firm directs its customers to send payment to. The banks make . . . View Full Definition

Locked In: When an investor is unable to take advantage of preferential tax treatment because of time remaining on a required holding period. Also, a commodities position in which the market has a limi . . . View Full Definition

Locked Market: A market is locked if the bid price equals the ask price. This can occur, for example, if the market is brokered and one side pays brokerage only, in over-the-counter trading the initiator o . . . View Full Definition

Log-Linear Least-Squares Method: A statistical technique for fitting a curve to a set of data points. One of the variables is transformed by taking its logarithm, and then a straight line is fitted to the transformed set of . . . View Full Definition

Lognormal Distribution: Pattern of frequency of occurrence in which the logarithm of the variable follows a normal distribution. Lognormal distributions are used to describe returns calculated over periods of a yea . . . View Full Definition

Lombard Rate: Applies mainly to international equities. Interest rate the German Bundesbank uses as an upper limit to the day-to-day money rate, since no bank will pay higher rates in the money market tha . . . View Full Definition

London Commodity Exchange (LCE): Merged with the London International Financial Futures and Options Exchange in 1996.

London Interbank Offered Rate (LIBOR): The rate of interest that major international banks in London charge each other for borrowings. Many variable interest rates in the U.S. are based on spreads off LIBOR. By contrast with the . . . View Full Definition

London International Financial Futures Exchange (LIFFE): A London exchange where Eurodollar futures as well as futures-style options are traded.

London Metal Exchange (LME): A market for trading base metals, where traded options contracts are available against the underlying futures contract.

London Stock Exchange (LSE): The U.K.'s six regional exchanges joined together in 1973 to form the stock exchange of Great Britain and Ireland, later named the LSE. The FTSE 100 index (known as the footsie) is its domin . . . View Full Definition

Long: One who has bought a contract to establish a market position and who has not yet closed out this position through an offsetting sale; the opposite of short.

Long Bonds: Bonds with a long current maturity. The 'long bond' is the 30-year U.S. Treasury bond.

Long Coupons: (1) Bonds or notes with a long current maturity. (2) A bond on which one of the coupon periods, usually the first, is longer than the other periods or the standard period.

Long Hedge: The purchase of a futures contract in anticipation of actual purchases in the cash market. Used by processors or exporters as protection against an advance in the cash price. Related: hedge, . . . View Full Definition

Long Leg: The part of an option spread in which an agreement to buy the underlying security is made.

Long Position: Owning or holding options (i.e., the number of contracts bought exceeds the number of contracts sold). For equities, a long position occurs when an individual owns securities. An owner of 1, . . . View Full Definition

Long Run: A period of time in which all costs are variable; longer than one year.

Long Straddle: Taking a long position in both a put and a call option.

Long-Term: In accounting terms, one year or longer.

Long-Term Anticipation Securities (LEAPS): Long-term options.

Long-Term Asset: Any asset that has an economic life greater than one year. Liquid items such as cash are considered to be current or short-term assets. Under accounting rules, intangible assets must always . . . View Full Definition

Long-Term Assets: Value of property, equipment, and other capital assets minus the depreciation. This is an entry in the bookkeeping records of a company. It is usually established on a 'cost' basis, and thus . . . View Full Definition

Long-Term Borrowing: Liabilities that represent money borrowed from banks or other lenders to fund the ongoing operations of a business and that will not come due within one year.

Page: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 169 170 171 172 173 174 175 176 177 178 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196 197 198 199 200 201 202 203 204 205 206 207 208 209 210 211 212 213 214 215 216 217 218 219 220 221 222 223 224 225 226