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Glossary: A


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Abandon

The choice made by the holder of a covered warrant to allow the warrant to expire without exercise.

 

Accountants

They are the ‘gatekeepers’ of the public securities markets. Accountants ensure that the financial statements are correct and complete and give an accurate picture of the company.

 

Acquisitions

One company takes over another by purchasing its assets or shares. Acquisitions can be friendly or hostile.

 

Active fund

A fund in which the fund manager actively manages investments (see active management).

 

Active management

Fund managers strive to outperform the market by identifying stocks that could produce better returns and beat the overall market (or target index).

 

ADMN

Admin. Period

 

Admission and Disclosure Standards

The London Stock Exchange's Admission and Disclosure Standards are for companies admitted or seeking to be admitted to trading.

 

Admission or admission to trading

Admission to trading on the Exchange’s markets for listed securities and ‘admitted’ and ‘traded’ shall be construed accordingly. For the avoidance of doubt this does not include ‘when issued dealings’.

 

Advisory broker

An advisory broker advises (and executes) buy and sell decisions on behalf of the client. However, the final decision to buy and sell always rests with the client.

 

AESP

Automatic Execution Suspended

 

AGM

See Annual General Meeting.

 

AIM
The Exchange’s global market for smaller and growing companies.

 

Alternative investment market (AIM)

See AIM.

 

American depositary receipts (ADRs)

ADRs are a convenient way for domestic investors to own shares in foreign companies. Denominated in US dollars, ADRs allow American investors to invest in a foreign company. However, ADRs are also traded in London.

 

American style covered warrant

An American style covered warrant allows the holder to exercise the covered warrant at any time on or before the expiry date.

 

American style option

Gives the buyer the right to exercise the option at any time before its expiry.

 

Annual General Meeting (AGM)

An annual meeting called by the directors of a company that allow shareholders to stay informed and involved with company decisions and workings.

 

Anonymous Order

An order that is displayed without the mnemonic of the participant that submitted it.

 

Applicant

An issuer that is proposing to apply, or is applying, for admission to trading of any of its securities.

 

Arbitrage

Buying securities in one country, currency or market, and selling in another to take advantage of price differences.

 

At best order

An order submitted to an order book to deal in a specified number of shares. It may execute, either in part or in full, against eligible orders (at the price of those orders). Unexecuted portions of at best orders are rejected from the order book. Sometimes referred to as an 'Aggressive Type A' order.

 

At-the-Money (covered warrant)

A covered warrant is At-the-Money when the strike price is the same, or very close to, the price of the underlying. It applies to both Calls and Put warrants.

 

Attribute groups

A grouping of certain companies admitted to trading which are identified by common attributes to provide additional profile and which satisfy the eligibility criteria for that grouping.

 

Auction Call Period

A period of time when there is no automatic execution on an order book. Orders that are allowed during auctions may be entered during this period.

 

Auction Match Trade (UT)

The total volume of trades executed at the auction match price are disseminated to the market as a single trade denoted by UT.

 

Auction Matching/ Auction Match Algorithm

The process that matches orders at the end of an auction and determines the auction price.

 

Auction period

A period of time during which an auction is in operation. This includes the auction call and any extensions to the auction. The auction period ends with an auction match.

 

Auction price

The price at which orders execute during an auction match - uncrossing price.

 

Auction volume

The auction volume is the total executed volume as a result of an auction.
Auditing Documenting and recording all business activities and transactions of an individual or a firm. Such a historic record allows to piece together the chronology of a trade.

 

Authorisation

The process by which organisations are vetted and licensed to conduct investment business under the Financial Services and Markets Act 2000. Such organisations are known as Authorised Persons.

 

Authorised share capital

The total number of shares a company is authorised to issue with regard to its memorandum and articles of association.

 

Automatic Execution

An automatic trade executed by the trading system. Automatic trades are executed by matching buy and sell orders.

 

Automatic Execution Suspension Period (AESP)

The period during which automatic execution is suspended. An AESP is applied to a security during continuous trading, if the potential execution price of that security breaches the price tolerance levels.

 

Automatic Trade (AT)

A trade generated by the system through automatic execution.

 

Average Price

The transaction was effected at a price based on a volume weighted average price over a given period.

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