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| CAC 40 |
Index of leading shares listed on Euronext Paris. The CAC 40 is calculated from the prices of the 40 most actively traded shares on the exchange. The component stocks in the index change regularly.
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| CAC 40 portion |
Portion of the reference portfolio with variable and changing exposure to the CAC 40 index.
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| CAD |
Capital Adequacy Directive; European Directive of 15 March 1993 laying down rules with regard to the own resources of investment firms and credit institutions. This directive fits into the liberalisation of European financial services.
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| COB |
Charged with safeguarding public savings, the COB supervises the quality of information disseminated by listed companies and ensures that securities transactions in France comply with regulations.
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| Call Option |
Gives its buyer the right to buy the underlying value at a fixed price before a specified expiration date. Call buyers hope the price of the stock will rise. Call sellers hope the price will stay the same or go down.
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| Call warrant |
A warrant which gives the warrant holder the right, but not the obligation, to buy the underlying security at a predetermined price (the exercise or strike price), on (European style) or before (American style) a predetermined date (the expiry or maturity date). The value of a call warrant will generally appreciate when the price of the underlying security appreciates.
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| Carry over |
The situation where an investor on the Forward Market postpones a bull position to the next fortnight period, speculating on a continuous rise of the prices: delay of payment until the next settlement day.
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| Cash equitisation |
The temporary conversion of cash amounts into securities until a specific investment can be found for that cash. “Parking” money in trackers ensures that the investor does not miss out on general price increases. Cash equitisation is regularly used by managers of open-ended investment funds.
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| Cash extraction |
A warrant strategy which consists of selling a stock portfolio or a single share and buying the corresponding number of warrants required to maintain the equivalent level of exposure.
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| Cash portion |
Portion of the reference portfolio exposed to EONIA plus 0.50% annually. Where the cash potion is negative, the fund has borrowed in order to finance its leverage. Also known as the non-risky portion.
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| Cash settlement |
The cash payment made by the issuer to a warrant holder following the exercise of a warrant. The settlement amount is equal to the intrinsic value, calculated in the manner described in the Pricing Supplement.
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| Cash settlement |
The process by which the terms of a warrant contract are fulfilled through the payment or receipt in euros of the warrant’s intrinsic value. The other possible settlement process is physical settlement.
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| Cash trading |
Trading method used on Euronext markets that consists in paying for purchases and sales immediately after a trade.
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| Certificate |
Term used by Euronext to designate various types of derivative financial instruments issued by banks, which provide liquidity for them. Certificates are quoted continuously on a special segment of Euronext Paris and are indexed on movements in the underlying. Certificates are used for portfolio hedging or speculation.
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| Clearing House |
The clearing house function assumed by Clearnet, Euronext subsidiary under RGV, France's automated clearing and settlement system.
This comes into play in all trades between Bourse member firms. By eliminating counterparty risk, it cuts short the chain reaction a fail would otherwise trigger and has reduced uncleared trades in Paris to virtually nil.
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| Closed-end Mutual Funds |
A mutual fund that issues a set number of shares, which then are only re-sold on the secondary market exchanges like regular stock shares.
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| Collective investment scheme |
Savings vehicle based on a collectively held portfolio invested in securities and managed by a professional. In France, collective investment schemes can be incorporated (SICAVs) or unincorporated (FCPs).
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| Commodities clearing member |
Commodities clearing member (adhérent compensateur en marchandises) "ACM"
A ACM is entitled only to clear and trade commodity futures and options for its own account and for clients.
A ACM can clear the trades of NEMs for whom it is the designated clearer.
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| Company warrants |
Options issued by companies to raise equity capital. Upon exercise, the company will issue new shares.
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| Compounding |
The computation of interest paid, using the principal plus the previously earned interest. Compounding measures the growth of an investment when dividends or appreciation are reinvested.
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| Conseil des Marchés Financiers |
A professional body created in 1996 to replace the Conseil des Bourses de Valeurs and the Conseil du Marché à Terme, the CMF is responsible for regulating and monitoring investment services other than third party asset management. It thus supervises trade in financial instruments, clearing, account administration, new issues and the administration of public offerings. It also approves central securities depositories and their general operating regulations, as well as systems used for clearing and settlement of securities transactions. The CMF's 16 members are appointed by the Ministry of the Economy and Finance, and include representatives of intermediaries (6), commodity markets (1), issuers (3), investors (3) and professional working in the sector (1), as well as two well-known experts in the field.
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| Contango rate |
0,085% of the value of the order; an amount the investor has to pay should he wishes to postpone his position on the Forward Market to the next fortnight period : backwardation or carry over.
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| Continuous flow of market data |
A continuous flow of market data provided exclusively to data vendors.
Available through Euronext, it includes both raw data such as prices, trade volumes and five best bids and offers, and in-depth information on financial instruments such as shares, trackers, warrants, bonds, etc.. Information services that use FIM pay for technical support as well as fixed fee for rights, and in turn charge their subscribers according to the volume of information received and the use it is put to.
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| Contract note |
A confirming note containing details of a trade, sent by a financial intermediary to its client. The contract note specifies the market side (buy or sell), the amount, the date, and transaction costs (brokerage fee, stamp duty, etc.). Also known as a trade confirmation.
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| Conversion ratio |
The number of warrants that must be exercised to either buy (for call warrants) or sell (for put warrants) the underlying security. See also Parity.
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| Core/satellite strategies |
An investment strategy based on a solid core that is surrounded by more specific satellite strategies. Trackers that follow a general, diversified index can form the core strategy, while individual shares or trackers that are based on specific sector indices (e.g. telecom, technology, pharmacy or banks) can serve as satellite strategies. |
| Corporate Bond |
Debt obligations issued by corporations as an alternative to offering equity ownership by issuing stock. Debt risk is judged by rating agencies. Bonds with ratings from BBB and higher are called ‘Investment grade’, bonds with lower ratings ‘High Yield bonds’ or ‘Junk bonds’.
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| Coupon |
Interest paid to the holder of a bond. See Dividend
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| Currency Warrant |
A warrant based on an underlying Exchange Rate.
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| Cushion |
Portion of the assets of a guaranteed or protected fund that can be exposed to risk without jeopardising the guarantee or protection feature. For example, if a fund worth €100 needs €80 to honour the guarantee or protection, it can expose €20 ("the cushion") to risk in order to boost returns.
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| Custody fee |
Amount charged by a financial intermediary for administering a securities account.
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