M&A: Mergers and Acquisitions

Macaroni defense: The macaroni defense is a tactic used by a corporation that is the tar ...

Macaulay duration: The weighted-average term to maturity of the cash flows from the bond, ...

Macroeconomics: The subdivision of the discipline of economics that studies and strive ...

MAD: Moroccan Dirham from Morocco. Also used in Western Sahara.

Madrid Stock Exchange (Bolsa de Madrid): The largest of Spain's four stock exchange.

Magic of diversification: The effective reduction of risk (variance) of a portfolio, achieved wi ...

Mail float: Refers to the part of the collection and disbursement process where ch ...

Maintenance margin requirement: A sum, usually smaller than -but part of the original margin, which mu ...

Majority voting: Voting system under which each director is voted upon separately.

Make a market: A dealer is said to make a market when he quotes bid and offered price ...

Making delivery: Refers to the seller's actually turning over to the buyer the asset ag ...

Malcolm Balridge National Quality Award (MBNQA): The Award is named for Malcolm Balridge, who served as Secretary of Co ...

Managed float: Also known as "dirty" float, this is a system of floating exchange rat ...

Management BuyIn (MBI): This is when a small group of shareholders organise a take-over of a c ...

Management buyout (MBO): Leveraged buyout whereby the acquiring group is led by the firm's man ...

Management fee: An investment advisory fee charged by the financial advisor to a fund ...

Management/closely held shares: Percentage of shares held by persons closely related to a company, as ...

Managerial decisions: Decisions concerning the operation of the firm, such as the choice of ...

Mandatory redemption schedule: Schedule according to which sinking fund payments must be made.



Mangement's discussion: A report from management to the shareholders that accompanies the firm ...

Manufactured housing securities (MHSs): Loans on manufactured homes - that is, factory-built or prefabricated ...

Margin: This allows investors to buy securities by borrowing money from a brok ...

Margin account (Stocks): A leverageable account in which stocks can be purchased for a combinat ...

Margin call: A demand for additional funds because of adverse price movement. Maint ...

Margin of safety: With respect to working capital management, the difference between (a) ...

Margin requirement (Options): The amount of cash an uncovered (naked) option writer is required to ...

Marginal: Incremental.

Marginal tax rate: The tax rate that would have to be paid on any additional dollars of t ...

Mark: Person who is the object of a deceptive business practice.

Mark-to-market: The practice of revaluing an instrument ot reflect the current values ...

Marked-to-market: An arrangement whereby the profits or losses on a futures contract are ...

Market capitalization: The total dollar value of all outstanding shares. Computed as shares t ...

Market capitalization rate: Expected return on a security. The market-consensus estimate of the ap ...

Market clearing: Total demand for loans by borrowers equals total supply of loans from ...

Market Close: The term market close refers to the time of day that a market closes. ...

Market conversion price: Also called conversion parity price, the price that an investor effect ...

Market cycle: The period between the 2 latest highs or lows of the S&P 500, showing ...

Market impact costs: Also called price impact costs, the result of a bid/ask spread and a d ...

Market Index Deposits (MIDs): Bank certificates of deposit or deposit notes with a return linked to ...



Market Mix: The description of the four P's of marketing - i.e. Price, Place (Dist ...

Market model: This relationship is sometimes called the single-index model. The mark ...

Market order: This is an order to immediately buy or sell a security at the current ...

Market overhang: The theory that in certain situations, institutions wish to sell their ...

Market portfolio: A portfolio consisting of all assets available to investors, with each ...

Market price of risk: A measure of the extra return, or risk premium, that investors demand ...

Market prices: The amount of money that a willing buyer pays to acquire something fro ...

Market return: The return on the market portfolio.

Market risk: Risk that cannot be diversified away.

Market sectors: The classifications of bonds by issuer characteristics, such as state ...

Market segmentation or preferred habitat theory: A biased expectations theory that asserts that the shape of the yield ...

Market timer: A money manager who assumes he or she can forecast when the stock mark ...

Market timing: Asset allocation in which the investment in the market is increased if ...

Market timing costs: Costs that arise from price movement of the stock during the time of t ...

Market value: (a) The price at which a security is trading and could presumably be p ...

Market value ratios: Ratios that relate the market price of the firm's common stock to sele ...

Market value-weighted index: An index of a group of securities computed by calculating a weighted a ...

Market-if-touched (MIT): A price order, below market if a buy or above market if a sell, that a ...

Market-to-Book: Compares a stock's market value to the value of total assets less tota ...

Marketability: A negotiable security is said to have good marketability if there is a ...



Marketed claims: Claims that can be bought and sold in financial markets, such as those ...

Marketed Deal: An arrangement in a public share distribution whereby the price at whi ...

Marketplace price efficiency: The degree to which the prices of assets reflect the available marketp ...

Markowitz diversification: A strategy that seeks to combine assets a portfolio with returns that ...

Markowitz efficient frontier: The graphical depiction of the Markowitz efficient set of portfolios ...

Markowitz efficient portfolio: Also called a mean-variance efficient portfolio, a portfolio that has ...

Markowitz efficient set of portfolios: The collection of all efficient portfolios, graphically referred to as ...

Master limited partnership (MLP): A publicly traded limited partnership.

Matador bonds: Foreign bonds issued in Spain.

Match fund: A bank is said to match fund a loan or other asset when it does so by ...

Matched book: A bank runs a matched book when the distribution of maturities of its ...

Matching concept: The accounting principle that requires the recognition of all costs th ...

Materials requirement planning: Computer-based systems that plan backward from the production schedule ...

Mathematical programming: An operations research technique that solves problems in which an opti ...

Mature: To cease to exist; to expire.

Maturity: For a bond, the date on which the principal is required to be repaid. ...

Maturity factoring: Factoring arrangement that provides collection and insurance of accoun ...

Maturity phase: A phase of company development in which earnings continue to grow at t ...

Maturity spread: The spread between any two maturity sectors of the bond market.

Mavera Injunction: A court injunction preventing the trustee for a trust from transferrin ...

Maximum price fluctuation: The maximum amount the contract price can change, up or down, during o ...

MBA: Master of Business Administration. Degree awarded by business schools. ...

MBS Depository: A book-entry depository for GNMA securities. The depository was initia ...

MBS servicing: The requirement that the mortgage servicer maintain payment of the ful ...

McCarthyism: Character assassination. Joseph McCarthy was a Senator from Wisconsin ...

McJob: A low-paying position in service companies. One survey predicted that ...

MDL: Moldavian Leu from the Republic of Moldova.

Mean: The expected value of a random variable.

Mean of the sample: The arithmetic average; that is, the sum of the observations divided b ...

Mean-variance analysis: Evaluation of risky prospects based on the expected value and variance ...

Mean-variance criterion: The selection of portfolios based on the means and variances of their ...

Measurement error: Errors in measuring an explanatory variable in a regression that leads ...

Medium-term note (MTN): A corporate debt instrument that is continuously offered to investors ...

Medium-term or intermediate-term bonds: Bonds with a maturity of between five and twelve years.

Membership or a seat on the exchange: A limited number of exchange positions that enable the holder to trad ...

Merchandise: All movable goods such as cars, textiles, appliances, etc. and 'f.o.b. ...

Merchant bank: A British term for a bank that specializes not in lending out its own ...

Merger: Refers to negotiations between friendly parties who arrive at a mutual ...

MGF: Malagasy Franc from Madagascar.

Microeconomics: The subdivision of the discipline of economics that studies the behavi ...

Middle East dollar market: A Middle East dollar market exists in Bahrain where eurodollars and ot ...

Mimic: An imitation that sends a false signal.

Minimum price fluctuation: Smallest increment of price movement possible in trading a given contr ...

Minimum purchases: For mutual funds, the amount required to open a new account (Minimum I ...

Minimum-variance frontier: Graph of the lowest possible portfolio variance that is attainable for ...

Minimum-variance portfolio: The portfolio of risky assets with lowest variance.

Minority interest: An outside ownership interest in a subsidiary that is consolidated wit ...

MIP: Maximum Investment Plan

MIRAS: Mortgage Interest Relief at Source

Mismatch bond: Floating rate note whose interest rate is reset at more frequent inter ...

Mission-critical: Meaning "critical to the functioning or success of a business or pr ...

MKD: Macedonian Dinar from the former Yugoslav Republic of Macedonia.

MLF: Malian Franc from Mali.

MMK: Kyat from Myanmar (formerly known as Burma).

MNC: Multi-National Corporation

MNT: Tugrik from Mongolia.

Modeling: The process of creating a depiction of reality, such as a graph, pictu ...

Modern portfolio theory: Principles underlying the analysis and evaluation of rational portfoli ...

Modified duration: The ratio of Macaulay duration to (1 + y), where y = the bond yield. M ...

Modified pass-throughs: Agency pass-throughs that guarantee (a) timely interest payments and ( ...

Modigliani and Miller Proposition I: A proposition by Modigliani and Miller which states that a firm cannot ...

Modigliani and Miller Proposition II: A proposition by Modigliani and Miller which states that the cost of ...

Momentum: In technical analysis, the relative change in price over a specific ti ...

Mommy track: Damaging, dead end career status often afforded people with family res ...

Monetary / non-monetary method: Under this translation method, monetary items (e.g. cash, accounts pa ...

Monetary gold: Gold held by governmental authorities as a financial asset.

Monetary neutrality: A proposition that in the long run, a percentage rise in the money sup ...

Monetary policy: Actions taken by the Board of Governors of the Federal Reserve System ...

Money base: Composed of currency and coins outside the banking system plus liabili ...

Money center banks: Banks that raise most of their funds from the domestic and internation ...

Money market: Money markets are for borrowing and lending money for three years or l ...

Money market demand account: An account that pays interest based on short-term interest rates.

Money market fund: A mutual fund that invests only in short term securities, such as bank ...

Money market hedge: The use of borrowing and lending transactions in foreign currencies to ...

Money market notes: Publicly traded issues that may be collateralized by mortgages and MBS ...

Money purchase plan: A defined benefit contribution plan in which the participant contribut ...

Money rate of return: Annual money return as a percentage of asset value.

Money supply: M1-A: Currency plus demand deposits M1-B: M1-A plus other checkab ...

Monitor: To seek information about an agent's behavior; a device that provides ...

Monopsony: Literally, single buyer. A situation in which a single firm or individ ...

Monte Carlo simulation: An analytical technique for solving a problem by performing a large nu ...

Monthly income preferred security (MIP): Preferred stock issued by a subsidiary located in a tax haven. The su ...

Montreal Stock Exchange (MSE): One of the four major stock exchanges in Canada.

MOP: Pataca from Macao (also spelled Macau).

Moral hazard: The risk that the existence of a contract will change the behavior of ...

Mortality tables: Tables of probability that individuals of various ages will die within ...

Mortgage: A loan secured by the collateral of some specified real estate propert ...

Mortgage bond: A bond in which the issuer has granted the bondholders a lien against ...

Mortgage duration: A modification of standard duration to account for the impact on durat ...

Mortgage pass-through security: Also called a passthrough, a security created when one or more mortgag ...

Mortgage pipeline: The period from the taking of applications from prospective mortgage b ...

Mortgage rate: The interest rate on a mortgage loan.

Mortgage sector: Securities backed by mortgage loans. These are loans obtained by borro ...

Mortgage-backed securities (MBS): Securities backed by a pool of mortgage loans.

Mortgage-Backed Securities Clearing Corporation: A wholly owned subsidiary of the Midwest Stock Exchange that operates ...

Mortgage-pipeline risk: The risk associated with taking applications from prospective mortgage ...

Mortgagee: The lender of a loan secured by property.

Mortgager: The borrower of a loan secured by property.

Most distant futures contract: When several futures contracts are considered, the contract settling l ...

Moving average: The moving averages is one of the oldest and most popular of technical ...

MRO: Ouguiya from Mauritania. Also used in Western Sahara.

MSc: Master of Science. Degree awarded by postgraduate departments / busine ...

MTL: Maltese Lira from Malta.

MTP: Maltese Pound, replaced by the Maltese Lira (MTL).

Multi-option financing facility: A syndicated confirmed credit line with attached options.

Multicolinearity: One variable is the expression of the other

Multicurrency clause: Such a clause on a Euro loan permits the borrower to switch from one c ...

Multicurrency loans: Give the borrower the possibility of drawing a loan in different curre ...

Multifactor CAPM: A version of the capital asset pricing model derived by Merton that in ...

Multifamily loans: Loans usually represented by conventional mortgages on multi-family re ...

Multinational corporation: A firm that operates in more than one country.

Multiperiod immunization: A portfolio strategy in which a portfolio is created that will be capa ...

Multiple rates of return: More than one rate of return from the same project that make the net p ...

Multiple regression: The estimated relationship between a dependent variable and more than ...

Multiple-discriminant analysis (MDA): Statistical technique for distinguishing between two groups on the ba ...

Multiple-issuer pools: Under the GNMA-II program, pools formed through the aggregation of ind ...

Multiples: Another name for price/earnings ratios.

Multirule system: A technical trading strategy that combines mechanical rules, such as t ...

Municipal bond: State or local governments offer muni bonds or municipals, as they are ...

Municipal notes: Short-term notes issued by municipalities in anticipation of tax recei ...

MUR: Mauritius Rupee from Mauritius.

Mutual fund: Mutual funds are pools of money that are managed by an investment comp ...

Mutual Fund Switching Privileges: Allow an investor to switch out of and into a different fund(s) within ...

Mutual fund theorem: A result associated with the CAPM, asserting that investors will choos ...

Mutual Legal Assistance Treaty (MLAT): An agreement among the U.S. and many Caribbean countries for the excha ...

Mutual offset: A system, such as the arrangement between the CME and SIMEX, which all ...

Mutually exclusive investment decisions: Investment decisions in which the acceptance of a project precludes t ...

MVA: Market Value Added (MVA) = market value - invested capital. M ...

MVR: Rufiyaa from Maldives.

MWK: Malawian Kwacha from Malawi.

MXN: Mexican New Peso (replacement for Mexican Peso) from Mexico.

MXP: Mexican Peso (replaced by Mexican New Peso (MXN))

MYR: Ringgit (also known as Malaysian Dollar) from Malaysia.

MZM: Metical from Mozambique.

Did you know?

Liquidity risk on bonds

The primary measure of liquidity is the size of the bid-ask spread. Liquidity risk depends on the ease with which an issue can be sold at or near its value. It follows that the wider the dealer spread, the more liquidity risk.


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