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- G
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Fifth letter of a
NASDAQ stock symbol specifying that it is the first convertible bond of the company.
- G.A.A.P.
- See:
Generally Accepted Accounting Principals
- G.D.P.
- See:
Gross Domestic Product
- G.I.C.
- See:
Guaranteed Investment Contract
- G.N.P.
- See:
Gross National Product
- G.M.C.
- See:
Guaranteed Mortgage Certificate
- G.P.M.
- See:
Graduated Payment Mortgages
- G.T.C.
- See:
Good 'til cancelled order
- Gamma
- The ratio of a change in the
option
delta to a small change in the price of the
asset on which the option is
written.
- Gap opening
- Used in the context of general equities.
Opening price that is substantially higher or lower than the previous day's
closing price, usually because of some extraordinarily positive or negative news.
-
Garmen-Kohlhagen option pricing model
- A widely used model for pricing
foreign currency options.
- Gearing
- Financial
leverage.
- GEMs (growing-equity mortgages)
-
Mortgages in which annual increases in monthly payments are used to reduce
outstanding
principal and to shorten the term of the
loan.
- General cash offer
- A
public offering made to
investors at large.
- General obligation bonds
-
Municipal securities secured by the issuer's pledge of its full faith, credit, and taxing power.
- General partner
- A
partner who has
unlimited liability for the obligations of the
partnership.
- General partnership
- A
partnership in which all partners are
general partners.
-
Generally Accepted Accounting Principals (G.A.A.P.)
- A technical accounting term that encompasses the conventions, rules, and procedures necessary to define accepted accounting practice at a particular time in the U.S.
- Generic
- Refers to the characteristics and/or experience of the total universe of a
coupon of
M.B.S. sector type; that is, in contrast to a specific pool or collateral group, as in a specific
C.M.O.
issue.
- Geographic risk
-
Risk that arises when an
issuer has policies concentrated within certain geographic areas, such as the risk of damage from a hurricane or an earthquake.
- Geometric mean return
- Also called the
time weighted rate of return, a measure of the
compounded rate of growth of the initial
portfolio
market value during the evaluation period, assuming that all cash distributions are reinvested in the portfolio. It is computed by taking the geometric average of the
portfolio
subperiod returns.
- Gestation repo
- A
reverse repurchase agreement between
mortgage firms and
securities
dealers. Under the agreement, the firm sells federal
agency-guaranteed
M.B.S. and simultaneously agrees to repurchase them at a future date at a fixed price.
- Get hit
- Go lower in price, due to
bids in the
stock or
market being
hit, causing those bids to vanish and be replaced by lower ones.
Come in. Antithesis of
on the take.
- Get out
- Used in the context of general equities. Sell interest ("We could get out big size in Humana".)
- Gilt-edged securities
- British and Irish government securities.
Blue Chip
- Ginnie Mae
- See:
Government National Mortgage Association.
- Give up
- Used for listed equity
securities. 1) Term used in a securities transaction involving three
brokers, as illustrated by the following scenario: Broker A, a
floor broker,
executes a buy
order for broker B. (Another
member firm broker who has too much business at the time to
execute the order.) The broker with whom broker A completes the transaction (the sell side broker) is broker C. Broker A "gives up" the name of broker B, so that the record shows a transaction between broker B and broker C even though the
trade was actually executed between broker A and broker C; 2) distribution of commissions to brokerage houses not participating in a trade. This is a grey area of the law intended to reimburse a broker for previously provided services (i.e., Research). See:
directed brokerage.
- Glass-Steagall Act
- A 1933 act in which Congress forbade commercial banks to own,
underwrite, or deal in corporate stock and corporate bonds.
- Global bonds
-
Bonds that are designed so as to qualify for immediate trading in any domestic
capital market and in the
Euromarket.
- Global fund
- A
mutual fund that can invest anywhere in the world, including the U.S.
- Globalization
- Tendency toward a worldwide investment environment, and the integration of national
capital markets.
- GNMA-I
-
Mortgage-backed securities (M.B.S.) on which registered
holders receive separate
principal and interest payments on each of their certificates, usually directly from the servicer of the M.B.S. pool.
GNMA-I mortgage-backed securities are single-issuer pools.
- GNMA-II
-
Mortgage-backed securities (M.B.S.) on which registered
holders receive an
aggregate
principal and interest payment from a central paying
agent on all of their certificates.
Principal and
interest payments are disbursed on the 20th day of the month.
GNMA-II M.B.S. are backed by multiple-issuer pools or custom pools (one issuer but different interest rates that may vary within one percentage point).
Multiple-issuer pools are known as "Jumbos." Jumbo pools are generally longer and offer certain mortgages that are more geographically diverse than single-issuer pools. Jumbo pool mortgage interest rates may vary within one percentage point.
- GNMA Midget
- A
GNMA pass-through certificate backed by
fixed rate mortgages with a 15 year
maturity. GNMA Midget is a
dealer term and is not used by GNMA in the formal description of its programs.
- Gnomes
-
Freddic Mac's 15-year, fixed-rate
pass-through securities
issued under its cash program.
- Go along
- Used for listed equity
securities.
Buy or sell at prices that randomly occur on the floor, participating in what
trades the
specialist and other
players will allow.
- Go-around
- When the
Fed
offers to buy
securities, to sell securities, to do
repo, or to do
reverses, it solicits competitive bids or
offers from all
primary dealers.
- Goes
- Used in the context of general equities. 1)
Trades ("10 IBM goes on at 115 "); See
Print; 2) indicates a change in the
stock's,
inside market ("Apple goes 3/4
bid").
- Going into the trade
- Used in the context of general equities. 1) Condition of the traders
position in the
security and expectations of
stock placement with accounts just prior to taking an order to the exchange floor for
execution; 2) On the way in. Antithesis of
come out of the trade.
- Going out
- Used in the context of general equities. Soliciting/advertising over the
SS1,
N.A.S.D.S.A.Q., or
Autex.
- Going-private transactions
- Publicly owned
stock in a firm is replaced with complete
equity ownership by a private group. The
shares are delisted from stock
exchanges and can no longer be purchased in the open
markets.
- Gold exchange standard
- A system of fixing
exchange rates adopted in the
Bretton Woods agreement. It involved the U.S. pegging the dollar to gold and other countries pegging their currencies to the dollar.
- Gold standard
- An international monetary system in which currencies are defined in terms of their gold content and payment imbalances between countries are settled in gold. It was in effect from about 1870-1914.
- Golden parachute
- Compensation paid to top-level management by a
target firm if a
takeover occurs.
- Good
- Used in the context of general equities. Including among the group and side (buy or sell) being discussed during the
block call.
- Good delivery
- A
delivery in which everything - endorsement, any necessary attached legal papers, etc. - is in order.
-
Good delivery and settlement procedures
- Refers to
PSA Uniform Practices such as cutoff times on
delivery of
securities and notification, allocation, and proper endorsement.
-
Good through/until date order
- Used in the context of general equities.
Market or
limited price order which is to be represented in the trading crowd for a stated period of time unless cancelled,
executed, or changed, after which such
order or the portion thereof not executed is to be treated as cancelled.
- Good 'til cancelled order (G.T.C.)
- It means an
order to
buy or
sell
stock that is good until you
execute or
cancel it. Brokerages usually set a limit of 30-60 days, at which the G.T.C. order expires if not restated. (In contrast to a
day order.)
- Goodwill
- Excess of the purchase price over the fair
market value of the net
assets acquired under the purchase method of accounting.
- Go to
- Used in the context of general equities. Sell interest ("We've got 50 IBM to go").
- Government bond
- See:
Government securities.
-
Government National Mortgage Association (Ginnie Mae)
- A wholly owned U.S. government corporation within the Department of Housing & Urban Development. Ginnie Mae guarantees the timely payment of
principal and interest on
securities
issued by approved servicers that are
collateralized by FHA-issued, VA-guaranteed, or Farmers Home Administration (FmHA)-guaranteed
mortgages.
-
Government sponsored enterprises
- Privately owned, publicly chartered entities, such as the Student Loan Marketing Association, created by Congress to reduce the
cost of capital for certain borrowing sectors of the economy including farmers, homeowners, and students.
- Government securities
- Negotiable
U.S. Treasury
securities.
- Graduated-payment mortgages (G.P.M.s)
- A type of stepped-payment loan in which the borrower's payments are initially lower than those on a comparable level-rate
mortgage. The payments are gradually increased over a predetermined period (usually 3,5, or 7 years) and then are fixed at a
level-pay schedule which will be higher than the level-pay
amortization of a level-pay mortgage originated at the same time.
The difference between what the borrower actually pays and the amount required to fully amortize the mortgage is added to the unpaid
principal balance.
- Graham-Harvey Measure 1
- Performance measure invented by John Graham and Campbell Harvey. The idea is to lever a fund's
portfolio to exactly match the
volatility of the
S&P 500. The difference between the fund's levered
return and the
S&P 500 return is the
performance measure.
- Graham-Harvey Measure 2
- Performance measure invented by John Graham and Campbell Harvey. The idea is to lever the
S&P 500 portfolio to exactly match the
volatility of the fund. The difference between the fund's
return and the levered
S&P 500 return is the performance measure.
- Grantor trust
- A mechanism of
issuing
MBS wherein the mortgages'
collateral is deposited with a trustee under a
custodial or trust agreement.
- Gray market
- Purchases and sales of
Eurobonds that occur before the
issue price is finally set.
- Graveyard market
- Used in the context of general equities.
Bear market wherein
investors who sell are faced with substantial losses, while potential investors prefer to stay
liquid; that is, to keep their money in cash or
cash equivalents until
market conditions improve.
- Great call
- Used in the context of general equities. Customer does not have a
working order in with the
trader, but we feel has an interest in participating in a
trade being constructed due to one's past
inquiry or activity.
- Greenmail
- Situation in which a large block of
stock is held by an unfriendly company, forcing the
target company to repurchase the stock at a substantial
premium to prevent a
takeover.
- Greenshoe option
- Option that allows the
underwriter for a new
issue to
buy and resell additional
shares.
- Grey list
- Used in the context of general equities. Formal grouping of
stocks which can be traded by the
block desks, but not in
risk arbitrage due to an Investment banks 0involvement with the company on non-public activity (i.e.,
Mergers and
Acquisitions defense). A stock's being on this list should never be conveyed to anyone outside of the trading area, much less outside of the firm. See
restricted list.
- Gross domestic product (G.D.P.)
- The
market value of goods and services produced over time including the income of foreign corporations and foreign residents working in the U.S., but excluding the income of U.S. residents and corporations overseas.
- Gross interest
-
Interest earned before taxes are deducted.
- Gross national product (G.N.P.)
- Measures and economy's total income. It is equal to
G.D.P. plus the income abroad accruing to domestic residents minus income generated in
domestic market accruing to non-residents.
- Gross parity
- Mainly applies to convertible securities and international equities. Antithesis of
net parity. For the price of a convertible = including
accrued interest. For the price of international
security = including commissions, fees,
stamp duty and other transaction costs, translated into U.S. dollar amounts.
- Gross profit margin
- Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold.
- Gross spread
- The fraction of the gross proceeds of an
underwritten
securities
offering that is paid as compensation to the
underwriters of the offering.
- Group of five (G-5)
- The five leading countries (France, Germany, Japan, United Kingdom, and the U.S.) that meet periodically to achieve some cooperative effort on international economic issues. When currency
issues are discussed, the monetary authorities of these nations hold the meeting.
- Group of seven (G-7)
- The
G-5 countries plus Canada and Italy.
- Group of eight (G-8)
- The
G-7 countries plus Russia.
- Group rotation manager
- A
top-down manager who infers the phases of the business cycle and allocates
assets accordingly.
- Growing perpetuity
- A constant stream of
cash flows without end that is expected to rise indefinitely.
- Growth manager
- A
money manager who seeks to
buy
stocks that are typically selling at relatively high
P/E ratios due to high
earnings growth, with the expectation of continued high or higher earnings growth.
- Growth opportunity
- Opportunity to invest in profitable projects.
- Growth phase
- A phase of development in which a company experiences rapid
earnings growth as it produces new products and expands
market share.
- Growth rates
- Compound annual growth rate for the number of full fiscal years shown. If there is a negative or zero value for the first or last year, the growth is N.M.(not meaningful).
- Growth stock
-
Common stock of a company that has an opportunity to invest money and earn more than the
opportunity cost of capital.
-
Guaranteed insurance contract
- A
contract promising a stated
nominal interest rate over some specific time period, usually several years.
-
Guaranteed investment contract (G.I.C.)
- A pure investment product in which a life company agrees, for a single
premium, to pay the
principal amount of a predetermined annual
crediting (interest) rate over the life of the investment, all of which is paid at the maturity date.
-
Guaranteed Mortgage Certificates (G.M.C.)
- First
issued by
Freddie Mac in 1975, G.M.C.s, like PCs, represent undivided interest in specified
conventional whole loans and
participations previously purchased by
Freddie Mac.
- Guarantor program
- Under the
(Federal Home Loan Mortgage Corporation) Freddie Mac program, the aggregation by a single issuer (usually an S&L) for the purpose of forming a qualifying pool to be
issued as PCs under the
Freddie Mac guarantee.
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