American terms to British

ABC1: A demographic group defined by occupation that is commonly targeted by media and advertising companies....more on ABC1
Abnormal return: The excess of actual return over the level of return that would be expected given the riskiness of a portfolio....more on Abnormal return
Absolute return: An absolute return is the actual amount of money made by an investment ; the actual gain as a percentage of the amount invested....more on Absolute return
Acceptances: Agreements by the shareholders of a company subject to a bid to sell their shares to the bidder....more on Acceptances
Accepting house: A financial institution that accepts (guarantees) bills of exchange in return for a fee...more on Accepting house
Accounting Rate of Return: Average operating profit ÷ average book value of assets, as a percentage....more on Accounting Rate of Return
Accounting Standards: Sets of rules governing how accounts are drawn up....more on accounting standards
Accounting Standards Board: The body that sets UK accounting standards. Its role has been reduced by IFRS....more on Accounting Standards Board
Accrual principle: The accounting principle of matching of costs to the revenues they generate....more on Accrual principle
Accruals: A balance sheet item for expenses for which invoices have not been received at the end of an accounting period....more on Accruals
Accrued interest: The amount of interest accumulated on a bond but not yet paid....more on Accrued interest
Acid test ratio: (current assets - stocks) ÷ current liabilities. A measure of a company's ability to pay short term debt....more on Acid test ratio
Acquisition: The purchase, by a company, of another company, a business, product lines or brands....more on Acquisition
Acquisitive growth: Growth that is the result of takeovers, as opposed to organic growth...more on Acquisitive growth
Active investing: Attempting to outperform the markets....more on Active investing
Activist shareholder: Investors who intervene in the running of a company....more on Activist shareholder
Actuary: Actuaries assess financial risk, calculate insurance premiums and value pension funds....more on Actuary
Ad driven media: The parts of the media that are dependent on advertising for their revenues, which therefore tend to be cyclical....more on Ad driven media
Adjusted EPS: EPS adjusted for non-cash or one-off items such as amortisation and exceptional costs to give a better indication of underlying trends...more on Adjusted EPS
Adjusted operating profit: Operating profit adjusted for non-cash or one-off items to give a better indication of underlying trends....more on Adjusted operating profit
Adjusted present value: An alternative to NPV. Cash flows are discounted using the cost of equity (instead of the WACC) and a separate adjustment is made for financing (i.e, the tax savings....more on Adjusted present value
Administrative receivership: The running of a company, or management of particular assets, is handed over to a receiver appointed by creditors in order to recover debts...more on Administrative receivership
ADR: A security issued in the US which bundles together a number of shares in a non-US company. ...more on ADR
Adverse opinion: An auditor's warning that a company's reported accounts do not show a true and fair view....more on Adverse opinion
Adverse selection: The tendency for those most at risk to be those most likely to buy insurance....more on Adverse selection
Advertising elasticity: The change in sales that results from a change in ad spend....more on Advertising elasticity
Advisory broking: Stockbroking services that offer investors advice from a stockbroker but where trades are only made on the client's instructions....more on Advisory broking
AER: Annual effective rate; a number that can be used to compare different fixed interest investments taking into account the effects of compounding....more on AER
Agency cross: A trade that a broker matches directly between two of its clients, bypassing the market...more on Agency cross
Agency theory: The economic analysis of the conflicts of interest between owners and managers of assets....more on Agency theory
Aggressive accounting: Manipulation of financial numbers, usually within the letter of accounting rules...more on Aggressive accounting
AGM (annual general meeting): A annual meeting at which shareholders vote on the appointment of directors and other important decisions....more on AGM (annual general meeting)
Agreed takeover bid: A take-over bid backed by the directors of the target company...more on Agreed takeover bid
AIM: A market run by the London Stock Exchange for trading in companies too small to list on their main market....more on AIM
Allotment: The allocation of a new issue of securities to applicants....more on Allotment
Alpha: The alpha of a security or fund is its out-performance over the risk adjusted return, with risk measured by beta....more on Alpha
American Depositary Receipt: A security issued in the US which bundles together a number of shares in a non-US company....more on American Depositary Receipt
American option: An option which can be exercised at the strike price at anytime before the expiry date....more on American option
Amortisation: Amortisation is the equivalent of depreciation for intangible assets....more on Amortisation
Angel investor: An individual investor who invests in a start-up that is unable to raise venture capital....more on Angel investor
Annual effective rate: A number that can be used to compare different fixed interest investments taking into account the effects of compounding....more on Annual effective rate
Annual premium equivalent: A measure that allows the calculation of new business numbers for an insurer that combines single premium and regular premium business....more on Annual premium equivalent
Annual report: The most important single regular release of information from the to investors...more on Annual report
Annuity: A regular income until the death purchased from a life insurance company for a lump sum....more on Annuity
API gravity: A measure of the density of crude oil....more on API gravity
APT: Arbitrage pricing theory; a valuation method which is theoretically sound but which is difficult to apply in practice....more on APT
APV: Adjusted present value; an alternative to NPV. Cash flows are discounted using the cost of equity with a separate adjustment for financing....more on APV
Arbitrage: Making a gain through trading securities without committing or risking money....more on Arbitrage
Arbitrage pricing theory: A valuation method which is theoretically sound but which is difficult to apply in practice....more on Arbitrage pricing theory
Arithmetic mean: The total divided by the number of numbers summed....more on Arithmetic mean
ARPU: The revenues from the services divided by the number of clients buying those services....more on ARPU
ARR: Accounting rate of return: average operating profit ÷average book value of assets, as a percentage....more on ARR
ASB: The body that sets UK accounting standards. Its role has been reduced by IFRS....more on ASB
Asian option: An option that has an exercise price that is based on the average price of the underlying security over a period....more on Asian option
ASK (Available Seat Kilometres): A measure of airline capacity: seats available ×distance flown....more on ASK (Available Seat Kilometres)
Asset allocation: Deciding the proportion of a portfolio that should be invested in each security type, market and sector....more on Asset allocation
Asset backed securities: Debt securities secured against specific cash flows....more on Asset backed securities
Asset stripping: The purchase of a company, followed by its breakup...more on Asset stripping
Asset turnover: Sales ÷ assets. Measures how effectively the assets invested in a business are at generating sales....more on Asset turnover
Assets under management: The amount of clients’ funds a fund manager manages. A measure of size and used for valuation....more on Assets under management
Associate company: A company in which a group of companies has a substantial stake (typically 20%-50%) but not outright control....more on Associate company
Assurance: Insurance against an inevitable event such as death....more on Assurance
At the money: An option is at-the-money if the strike price equals the exercise price...more on At the money
ATK (Available Tonne Kilometres): Aircraft weight carrying capacity in tonnes × km flown over period...more on ATK (Available Tonne Kilometres)
ATS (automated trading system): A computer system for matching orders in securities....more on ATS (automated trading system)
Audit: The independent checking of a company's accounts by external accounts....more on Audit
Auditors' opinion: The auditor's opinion on the whether a company's accounts give a true view of its finances....more on Auditors' opinion
Average: A generic term which can refer to one several types of average....more on Average
Average down: Buying more of a security which has fallen in price in order to lower the average price paid....more on Average down
Average Revenue Per User: The revenues from services divided by the number of clients buying those services....more on Average Revenue Per User
Back office: Administrative functions such as processing orders...more on Back office
Back-testing: The testing of a financial model by using it on past date and then comparing the 'predictions' to what actually happened....more on Back-testing
Backward integration: Increasing vertical integration by acquiring suppliers or otherwise increasing level of self supply....more on Backward integration
Backwardation: Backwardation is the opposite of forwardation; it occurs when the price of the future is less than the spot price of underlying commodity....more on Backwardation
Bad debt: Debt that is unlikely to be recoverable....more on Bad debt
Balance sheet: The balance sheet shows what assets and liabilities the company has, and how the business is funded....more on Balance sheet
Bancassurance: The sale of insurance and banking products through the same channel, most commonly bank branches selling insurance....more on Bancassurance
Banking covenants: Agreements between a company and its creditors that it should that the company should operate within certain limits, typically on debt levels, asset sales or gearing....more on Banking covenants
Bankruptcy: A person who is insolvent (unable to pay their debts) can be declared bankrupt. This means their assets and income become, for a period, by a trustee who attempts to clear what debts they can....more on Bankruptcy
Barrel of oil: In the oil industry, a barrel is 42 US gallons, approximately equal to 159 litres....more on Barrel of oil
Barrier options: A type of exotic option whose value depends on the underlying passing (or not) a particular price point....more on Barrier options
Barriers to entry: Anything that makes it difficult for a new entrant to break into a market....more on Barriers to entry
Basic EPS: Earnings per share without any adjustments...more on Basic EPS
Basis points: A basis point is to one hundredth of a percentage point (i.e. 0.01%)....more on Basis points
bboe: Billions of barrels of oil equivalent. A single number combining the volumes of oil and gas production....more on bboe
Bear: An investor who is pessimistic about the prospects for a market, a sector or a particular security....more on Bear
Bear raid: An attempt by traders to force the price down of a security by heavy forward selling. Such market manipulation is illegal in most countries....more on Bear raid
Bear squeeze: A price rise that causes bears to buy to cover their positions. The demand this creates causes further price rises....more on Bear squeeze
Bear trap: A short term dip in the price of a security that tempts bears into positions that make a loss when the price then rises again....more on Bear trap
Bearer securities: A security which gives the bearer of a paper certificate ownership, with no register of owners being maintained....more on Bearer securities
Behavioural finance: A branch of financial economics that models the behaviour of investors, rather than simply assuming that they are rational and risk averse....more on Behavioural finance
Benchmark: In an investment context most likely to mean a performance benchmark or a benchmark price....more on Benchmark
Benchmark index: The index or other measure against which the performance of a fund or portfolio is measured....more on Benchmark index
Benchmark price: Prices of commodities in a particular well specified, widely traded, form....more on Benchmark price
Beneficial ownership: The "real" owner of assets that are held by a trustee....more on Beneficial ownership
Beta: Beta is a measure of the correlation between the value of a security and the market. Beta is used to calculate discount rates for CAPM....more on Beta
Bid price: The highest price at which a buyer is willing to buy a particular security. The buyer may be a market maker or an ordinary investor....more on Bid price
Bid-offer spread: The difference between the prices at which shares can be bought and sold....more on Bid-offer spread
Binary options: Options that either pay a fixed amount or nothing....more on Binary options
Black-Scholes: The most widely used method of option valuation. More complex models are sometimes necessary as it uses a number of simplifying assumptions....more on Black-Scholes
Blue chip: A large company. Blue chip shares are generally lower risk. FTSE 100 constituents are generally considered blue chips....more on Blue chip
Boe: Barrels of oil equivalent is a single measure combining oil and natural gas production....more on Boe
Bonds: A bond is a security that pays interest. The majority of bonds have a fixed life at the end of which the principal is returned....more on Bonds
Bonus issue: The issue of new shares to existing shareholders at no charge in proportion to their existing shareholdings. It is basically a bookkeeping exercise....more on Bonus issue
Book value: The value of assets as shown on the balance sheet....more on Book value
Book to bill ratio: The ratio of the orders taken in a period to the amount invoiced over the same period. Most commonly used in the semiconductor industry....more on Book to bill ratio
Bottom fishing: Any investment strategy that relies on buying extremely cheap; an extreme form of value investing....more on Bottom fishing
Bottom-up stock selection: Picking individual stocks or securities rather than sectors or regions....more on Bottom-up stock selection
Boutique: A small specialist financial institution such as a fund manager or broker....more on Boutique
Brand: The identifying name and other distinguishing characteristics attached to a business and its products or services....more on Brand
Brand dilution: Brand dilution is the weakening of a brand though its overuse: often from ill judged brand extension....more on Brand dilution
Brand extension: Brand extension is the widening of the range of products sold using a particular brand. If overdone it can risk diluting a brand....more on Brand extension
Break-even: The break-even point is the level of sales (revenues or volumes) needed to cover the fixed costs; the level of sales at which neither a profit or loss is made....more on Break-even
Brent crude: The accepted world benchmark crude oil which is used to price two thirds of the world's internationally traded crude oil supplies....more on Brent crude
Bubble: Security prices far above the levels which can be justified by any rational assessment of the real value of future cash flows. Bubbles inevitably burst....more on Bubble
Bulge bracket banks: The largest, mostly American, investment banks....more on Bulge bracket banks
Building society: A British financial mutual. In effect, a a bank owned by depositors and borrowers....more on building societies
Bull: An investor who expects the market, sector or security to rise in price. The expectation of rises is described as "bullish"...more on bulls
Bull run: A period in which investors' optimism keeps the market moving strongly and consistently upwards...more on Bull
Bulldog bond: A sterling bond issued by an non-British issuer...more on Bulldog bond
Bundling: The practice of supplying two separate products together, so buyer who only want one, must buy both....more on Bundling
Business to business: Sales to another business as opposed to consumers...more on Business to business
Buy and hold: Any strategy that holds securities for long periods, avoiding frequent trading....more on buy and hold
Buy-side analyst: An analyst who works for an institutional investor such as a fund management company, usually producing research for internal use rather than publication....more on Buy-side analyst