Education Glossary

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Definitions Starting with "b"

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Term Definition
Baby Bond

A bond with a face value lower than $1k.

Back-End Load

A percentage fee that investors pay when redeeming mutual fund shares within a specified duration, typically 5 to 10 years.

Balanced Funds

Often referred to as ""Hybrid Funds", these are Mutual funds that invest in near equal proportions with both stocks and bonds for the purpose of growth and income.

Bar

A graphical representation of price activity for a specific time interval where open, high, low and closing prices for the interval are specified.

Base Currency

This is the first currency listed in a Forex currency pair. It serves as the basis for which the currency exchange rate will be quoted.

Base Rate

Is the minimum lending rate of the central bank for any given country.

Basis Point

A common unit of measure (1/100th of one percent) used to describe the percentage change in value of a financial instrument or interest rates.

Bear

An investor sentiment derived from a pessimistic belief that the financial markets (or any financial instrument within) is going to fall in value.

Bear Flag

A price chart pattern that represents asharp downtrend on high volume followed by generally sideways activity of gradually higher highs and higher lows.

Bear Market Correction

A long-term market trend where the prices of securities have declined by a significant (15-20)percentage and drives sustained pessimism among investors.

Bearish Divergence

Occuring within a bear market cycle, two technical indicators are moving in opposing directions signaling an approaching change in trend.

Bearish Engulfing Pattern

A Candlestick price chart pattern where a large black candlestick fully engulfs a small white candlestick appearing just prior.

Benchmark Index

Market indexes such as the Dow Jones Industrial Average, the S&P 500, or the Russell 2000 are used for comparison purposes by Portfolio Managers to evaluate portfolio performance.

Beta

Beta measures the volatility of a stock's return relative to the S&P 500. A higher beta value represents a higher probability of risk.

Bid

Is the price in a given market for which an asset may be sold (conversely, it is also the price at which it may be bought). The bid price is usually displayed with the amount of the asset which the buyer is prepared to buy.

Big Figure

Refers to the first 3 digits of a currency quote.

Binomial Model

An options valuation method that designates specific points in time within the time span of the valuation date to expiration. 

Black Box

A self-contained trading system comprised of model-based formulas that are not revealed to the trader/user.

Block

Designates more than 10,000 shares traded in a single transaction and is mostly attributed to institutional investors.

Block Trade

A large amount of stocks or bonds (at least 10,000 shares) traded in a single transaction.

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