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Glossary of financial terms - Letter S

  • S&P

    Tags:  financial system organisations or institutions

    Country:   United States of America

    See  


  • S&P 500

    Tags:  indices stock markets

    Country:   United States of America

    See  


  • sale and repurchase agreement

    Tags:  financial instruments money market instruments

    A sale and repurchase agreement, commonly called "repo", is a money market instrument in which one party sells securites to the other in exchange for cash. At the term of the repo transaction, securities are repurchased and the cash returned with interest.

     


  • SAR

    Tags:  financial instruments personal finance

    Country:   United States of America

    See  


  • Sarbanes-Oxley Act of 2002 (SOX)

    Tags:  regulation supervision and regulation texts of law

    The Sarbanes–Oxley Act of 2002 is a United States law to protect investors from the possibility of fraudulent accounting activities by corporations by imposing reforms to improve financial disclosures.

     


  • SBF120

    Tags:  indices stock markets

    French equity index created in 1993 and containing the 120 most active amongst the listed shares.

     


  • Schatz future

    Tags:  financial instruments interest rate derivatives

    See  


  • SDR

    Tags:  derivatives repository or database

    Country:   United States of America

    See  


  • SDR

    Tags:  economy financial system

    See  


  • SEAQ

    Tags:  financial markets quoting and negotiation systems

    Country:   United Kingdom

    See  


  • SEC

    Tags:  organisations or institutions supervision and regulation

    Country:   United States of America

    See  


  • secondary market

    Tags:  concept financial markets

    The secondary market is the market on which securities are being negociated once they have been issued.

     


  • second to default (STD)

    Tags:  credit derivatives financial instruments

    Second to default is a type of

    which will offer protection against the second entity to default.

     


  • secrecy agreement (SA)

    Tag:  documents and publications

    See  


  • Securities and Exchange Commission (SEC)

    Tags:  government agencies organisations or institutions supervision and regulation

    The U.S. Securities and Exchange Commission is an independent federal government agency responsible for regulating the securities industry and stock exchanges in the U.S. as well as the protection of investors.

     


  • Securities and Futures Commission (SFC)

    Tags:  organisations or institutions supervision and regulation

    The Securities and Futures Commission (SFC) is an independent statutory body created in 1989 to regulate Hong Kong's securities and futures markets.

     


  • securities financing transaction (SFT)

    Tags:  financial instruments money market instruments

    Generic term designing transactions where a market participant uses assets he holds in order to fund activities in the market.

     


  • securities lending indemnification

    Tags:  financial instruments securities lending

    Indemnification is an insurance policy offered by a lending agent which protects securities lenders against borrower credit risk.

     


  • securities loan

    Tags:  financial instruments securities lending

    Term designating a financial transaction in which the lender (the owner of the securities) temporarily transfers ownership in securities to the borrower, in exchange for compensation. This transfer is generally secured by collateral which can take on the form of cash, other securities or another form of financial commitment such as a letter of credit.

     


  • securitisation

    Tag:  securitisation

    Securitisation is the process of pooling debt securities or titles of the same type and with similar characteristics and then packaging them into a security which is sold to investors. Assets typically repackaged are residential and commercial mortgages, auto loans, credit card debt or bonds.

     


  • SEF

    Tags:  status supervision and regulation

    Country:   United States of America

    See  


  • self-regulatory organisation (SRO)

    Tags:  organisations or institutions typology

    A self-regulatory organisation (SRO) is a non-governmental organisation that has the authority to create and enforce regulations and standards for an industry or profession.

     


  • service level agreement (SLA)

    Tags:  contracts economy

    A service level agreement is a contract between a service provider and a client that defines the level of service the client is entitled to expect from the service provider.

     


  • SETS

    Tags:  financial markets quoting and negotiation systems

    Country:   United Kingdom

    See  


  • settlement

    Tags:  market transactions transaction settlement

    The term settlement describes the process of carrying out the delivery of a security and the transfer of the corresponding cash payment between two counterparties to a security transaction according to the terms which have been agreed.

     


  • settlement date

    Tags:  characteristics transaction settlement

    The date agreed upon by the parties to a securities transaction for the delivery of securities and payment of funds.

     


  • settlement instructions

    Tags:  concept transaction settlement

    See  


  • SFC

    Tags:  organisations or institutions supervision and regulation

    Country:   Hong Kong

    See  


  • SFT

    Tags:  market transactions securities lending

    Territory:   European Union

    See  


  • shadow banking

    Tags:  activities and occupations banking system

    Term designing a system of credit intermediation that involves entities and activities outside the regular banking system.

     


  • share

    Tag:  equities

    A share is a certificate which represents a right of ownership in a company. If confers its owner a number of rights, the most prominent of which being the right to take part in the decisions affecting the company by voting, and to be attributed a share of the company's profit.

     


  • share

    Tag:  equities

    A share is a certificate which represents a right of ownership in a company. If confers its owner a number of rights, the most prominent of which being the right to take part in the decisions affecting the company by voting, and to be attributed a share of the company's profit.

     


  • shareholder

    Tags:  corporate finance market participants

    A shareholder is an individual or legal entity that owns one or more shares in a public or private corporation.

     


  • short coupon

    Tags:  bonds characteristics

    Term designing a coupon period for a bond which is shorter than the other, regular coupon periods. If a bond has a short coupon, it is usually either the first or the last coupon of the bond.

     


  • short sale

    Tags:  concept market transactions

    A technique used to take advantage of an anticipated decline in the price of a security or to hedge a position. In a short sale, the investor borrows the security in the market and immediately sells it. Then, if the investor guessed right (or if the hedge was indeed needed) and the price of the security declines, he can replace the borrowed securities by buying them at the cheaper price.

     


  • short selling

    Tags:  concept market transactions

    See  


  • short term interest rate (STIR)

    Tags:  market rate money market

    The term short-term interest rate designates an interest rate at which short-term borrowings are made between financial institutions or the rate at which a short-term government paper is issued or traded in the market.

     


  • SIC

    Tags:  codes or standards economy

    Countries:   United Kingdom, United States of America

    See  


  • simple interest

    Tags:  concept time value of money

    Simple interest is a method of interest calculation where no compounding takes place, meaning that due interest is not bearing any interest.

     


  • Single Resolution Mechanism (SRM)

    Tags:  regulation supervision and regulation texts of law

    The single resolution mechanism is a process in the European Union's banking union for the

    of a bank that fails or is likely to fail and which operates under the Single Supervisory Mechanism.

     


  • single step-up note

    Tags:  interest rate instruments typology

    See  


  • sinking fund

    Tags:  guarantee funds security issuance

    Financial reserves set aside to be used exclusively to redeem a bond or preferred stock issue and thus reassure investors that the company will be able to meet that obligation.

     


  • SLA

    Tags:  contracts economy

    See  


  • slippage

    Tags:  market transactions terminology

    On a market price order, slippage describes the difference between the expected and the actual execution price.

     


  • Society for Worldwide Interbank Financial Telecommunication (SWIFT)

    Tags:  banking system organisations or institutions transaction settlement

    The Society for Worldwide Interbank Financial Telecommunication is a cooperative company which provides a messaging network for financial institutions worldwide, allowing them to send and receive information about financial transactions.

     


  • SONIA

    Tags:  indices interest rate markets

    Country:   United Kingdom

    See  


  • sovereign bond

    Tags:  bonds typology

    A bond issued by a sovereign government in foreign or international markets.

     


  • sovereign wealth fund (SWF)

    Tags:  funds investments

    From an international tax standpoint, there is no conventional definition of an SWF. This term generally refers to a state-owned fund which invests in a variety of real or financial assets (stocks, bond, real estate, commodities and other financial instruments).

     


  • SOX

    Tags:  regulation texts of law

    Country:   United States of America

    See  


  • SPE

    Tags:  financial engineering legal entities

    See  


  • special

    Tags:  concept securities lending

    If there is a temporarily limited supply of a particular security it is said to be 'on special'. The repo rate for the security will decrease (because there is short supply of the security relative to demand), the bond becomes more expensive to buy and its yield will tend to fall as the bond becomes expensive.

     


  • special drawing right (SDR)

    Tags:  economy financial system

    The special drawing right is an international reserve asset, created by the IMF in 1969 to supplement the official reserves of its member countries.

     


  • special purpose entity (SPE)

    Tags:  finance (general) securitisation status

    See  


  • special purpose vehicle (SPV)

    Tags:  finance (general) securitisation status

    A special-purpose vehicle is a legal entity created to fulfil a delimited, specific and often temporary objective. They are typically used by companies or financial institutions to isolate the them from financial risk.

     


  • spot

    Tags:  market transactions typology

    Today’s cash market price of an asset or financial product.

     


  • spot currency transaction

    Tags:  financial instruments foreign exchange instruments

    See  


  • SPV

    Tags:  financial engineering legal entities

    See  


  • SRM

    Tags:  financial system regulation

    Territory:   European Union

    See  


  • SRO

    Tags:  organisations or institutions typology

    See  


  • SSI

    Tags:  market transactions transaction settlement

    See  


  • Standard & Poor's 500

    Tags:  indices stock markets

    The Standard & Poor's 500 is an American stock market index based on the market capitalisations of 500 large companies which have common stock listed on the NYSE or NASDAQ.

     


  • Standard and Poor's

    Tags:  interest rate markets organisations or institutions

    American rating agency created in 1941. Together with

    and Fitch one of the three agencies dominating the rating industry.

     


  • Standard Industry Classification (SIC)

    Tags:  codes or standards economy

    The Standard Industrial Classification is a system for the classification of industries using a four-digit code.

     


  • standing settlement instructions (SSI)

    Tags:  market transactions transaction settlement

    Standing settlement instructions are a market participant’s default instructions for the payment and delivery of securities. They often differ depending on the type and denomination currency of the securities.

     


  • statement of condition

    Tags:  accounting finance (general)

    See  


  • statement of financial position

    Tags:  accounting finance (general)

    See  


  • STD

    Tags:  credit derivatives financial instruments

    See  


  • step-up note

    Tags:  interest rate instruments typology

    A step-up note is a fixed-income security whose coupon rate increases over time.

     


  • step-up swap

    Tags:  financial instruments interest rate derivatives

    See  


  • Sterling Overnight Index Average (SONIA)

    Tags:  indices interest rate markets

    SONIA is the effective effective overnight interest rate paid by banks for unsecured transactions in the British sterling market.

     


  • STIR

    Tags:  market rate money market

    See  


  • stock

    Tag:  equities

    See  


  • stock appreciation right (SAR)

    Tags:  financial instruments personal finance

    A stock appreciation right is an incentive granted to its employees by a company, which entitles the beneficiary to a payment in cash or shares equal to the appreciation in the company's stock over a specified period.

     


  • Stock Exchange Automated Quotation system (SEAQ)

    Tags:  financial markets quoting and negotiation systems

    Country:   United Kingdom

    The Stock Exchange Automated Quotation system is a system for trading small-cap stocks on the London Stock Exchange.

     


  • Stock Exchange Electronic Trading Service (SETS)

    Tags:  financial markets quoting and negotiation systems

    Country:   United Kingdom

    SETS is the electronic order book of the London Stock Exchange.

     


  • STP

    Tags:  concept transaction settlement

    See  


  • straddle

    Tags:  market transactions strategies

    A straddle is an option trading strategy which consists in buying (long straddle) or selling (short straddle) an identical number of puts and calls with the same underlying, same expiry date and same strike.

     


  • straight through processing (STP)

    Tags:  market transactions transaction settlement

    Straight-through processing is a term used in the financial industry to describe a system where transactions are processed electronically and automatically with no human intervention.

     


  • strike

    Tags:  characteristics options

    See  


  • strike price

    Tags:  characteristics options

    The specified price at which an option contract may be exercised. Also known as exercise price.

     


  • stripping

    Tags:  bonds financial techniques

    See  


  • structured product

    Tag:  financial instruments

    A financial instrument designed to meet specific issuer and investor needs which may involve the use of embedded swaps and options.

     


  • stub

    Tags:  bonds characteristics

    See  


  • supranational institution

    Tags:  financial system organisations or institutions

    A supranational institution is an entity that is formed by two or more national governments through international treaties. The purpose for creating a supranational institution frequently is to promote economic development or cooperation for the member countries.

     


  • swap

    Tags:  derivatives financial instruments

    A swap is a cash-settled financial derivative where two counter parties agree to exchange two streams of cash flows during the life of the swap. In its most basic form, the exchange involves a fixed and a floating interest rate, but swaps can be used to exchange virtually any type of cash flows.

     


  • swap data repository (SDR)

    Tags:  concept supervision and regulation

    A swap data repository is an entity in the United States which collects and maintains records of swap trades. Their main purpose is to help regulators monitor the build-up of systemic risk.

     


  • swap execution facility (SEF)

    Tags:  financial markets status

    A swap execution facility is a platform that allows participants to buy and sell swaps in a regulated and transparent manner.

     


  • swap spread

    Tags:  interest rate instruments valuation and pricing

    The swap spread is calculated as the difference between a government bond's yield and the yield of an interest rate swap of the same maturity. It represents the additional credit risk of the interbank market over the government debt market.

     


  • swaption

    Tags:  financial instruments interest rate derivatives

    An option on a swap. A payer’s swaption gives the holder the right to pay fixed in an interest rate swap if he so wishes. A receiver’s swaption gives the holder the right to receive fixed in an interest rate swap.

     


  • SWF

    Tags:  funds investments

    See  


  • SWIFT

    Tags:  banking system transaction settlement

    Country:   Belgium

    See  


  • switch

    Tags:  concept market transactions

    See  


  • syndicated issue

    Tags:  corporate actions interest rate instruments

    The issuance of a security managed by a group of financial institutions who form the so-called issue syndicate.

     


  • synthetic position

    Tags:  concept finance (general)

    The creation of a position or asset by using a combination that might include the cash markets, forwards, futures or options e.g. buying a put and selling a call will create a synthetic forward or future position.

     


  • systematic internaliser (SI)

    Tags:  market participants status

    A systematic internaliser is defined as an “investment firm which, on an organised, frequent, systematic and substantial basis, deals on own account when executing client orders outside a regulated market, an MTF or an OTF”. The term has been introduced by MiFID in 2007, then re-scoped in MiFID II.

     


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