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Glossary of Terms

macro economics

economic analysis which studies the behaviour of the overall economy, including items such as inflation, the interaction of fiscal and monetary policies, gdp, and balance of payments. the opposite of microeconomics.

management buy-in (mbi)

the purchase of a controlling interest in a business by an outside management team.

management buy-out (mbo)

the purchase of all outstanding shares in a business by its management team.

margin

a good faith deposit required by an exchange or clearing house as collateral for an investment in securities purchased on credit.

margin account

a type of account which allows the customer to borrow funds from maybank atr kim eng against their marginable securities to purchase additional stocks in the market.

margin alert

an email notification sent to the customer advising them that their margin ratio fell to between 200% and 175%. customer has 5 business days to bring up the margin ratio to at least 200%.

margin call

an email notification sent to the customer advising them that their margin ratio fell to between 175% and 150%. customer has 24 hours to bring up the margin ratio to at least 200%.

margin call

unfavorable movements in securities purchased on credit will result in a demand by a broker to an investor to put up money due to this decline in value. the exchange or clearing house calculates margins daily and requires prompt lodgement of sufficient collateral to maintain the required margin level and cover potential losses.

margin line

the amount the customer can borrow from maybank atr kim eng considering the collateral value and margin limit awarded. margin line is computed as 50% of the portfolio’s collateral value [in compliance to src 48.1] or the margin limit assigned, whichever is lower.

margin loan or margin utilization

total amount of borrowed funds

margin suspension

an email notification sent to the customer advising them that their equity percentage has fallen below 150% and that their margin account has been suspended. customer has 24 hours to bring up the margin ratio to at least 200%.

marginable securities

stocks which are used as collateral for additional buying power


mark-to-market

recording the price or value of a security on a daily basis, to calculate profits and losses or to confirm that margin requirements are being met.

market capitalization

the market price of a company, calculated by multiplying the share price by the number of shares outstanding. the market capitalization of the share market is the sum of the value of listed shares.

market maker

an exchange member who provides market liquidity, making a market by buying and selling for his own account at publicly quoted prices.

market order

an order to buy or sell a security at the present market price. as long as there is a market for this security, the order will be filled. this type of order takes precedence over all other orders.

market-if-touched

an order with the floor broker which becomes a market order if a trigger price is reached.

market-on-close

a stock or options market order to buy or sell a security which is to be executed at the current market price as close as possible to the end of that day's trading.

merger

the combining of two or more entities in a corporate restructuring, through a purchase acquisition or a pooling of interests. a merger is usually negotiated by the management of the two companies concerned. it differs from a consolidation in that a new entity is not created; and from a takeover in that negotiation occurs.

microeconomics

economic analysis that studies the behaviour of individual companies or markets and the impact of small economic units on the economy, such as consumers or households. the opposite of macroeconomics.

modeling

involves the design and analysis of a mathematical representation of an economic system to investigate the effect of changes to system variables.

modern portfolio theory (mpt)

overall investment strategy that seeks to construct an optimal portfolio to enable investment managers to classify, estimate and control the sources of risk and return.

monetary policy

the regulation of the supply of money and interest rates, by actions of a country’s central bank, to control inflation and stabilize the currency. a tightening of monetary policy by a government could influence the economy as the scarcity of money usually means higher interest rates.

money market

the market for trade in short-term debt securities such as bills of exchange, promissory notes and government and semi-government securities.

money supply

the total supply of money in circulation, held by members of the public and in bank deposits.

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