Glossary

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Embedded Derivative

Financial Term

An Embedded Derivative is a financial instrument that is embedded within a non-derivative contract such as a lease agreement or a loan. It is not a standalone security and derives its value from the underlying asset. The most common types of embedded derivatives are options, swaps, and forward contracts.

Embedded Derivatives are used in the financial industry to manage risks associated with the underlying assets of non-derivative contracts. For example, a company may enter into a lease agreement that includes an embedded derivative that provides the lessee with the option to purchase the leased asset at the end of the lease term. This embedded derivative allows the lessee to hedge against future price fluctuations of the asset while still being able to lease and use the asset in the short term.

Embedded derivatives can be complex financial instruments and require specialized knowledge to properly manage and value. Proper disclosure and analysis of embedded derivatives are essential for accurate financial reporting and compliance with accounting standards.

Overall, Embedded Derivatives have become an important part of the financial industry for managing risks and optimizing financial outcomes for companies and investors alike.

More Glossary Terms Beginning with E

E-Commerce
The sale of goods and services where the buyer places an order, or the price and terms of the sale are negotiated over an Electronic Data Interchange, the Internet, or any other online system (extranet, e-mail, instant messaging). Payment may or may not be made online.

Economy Term Letter: E
Earned Premiums or Premiums Earned
That portion of property casualty premiums written that applies to the expired portion of the policy term. Earned premiums are recognized as revenues under both Statutory Accounting Practices (SAP) and GAAP.

Insurance Term Letter: E
Earnings per Share basic
The companys earnings divided by the average number of shares outstanding for the period. Statement of Income

Financial Term Letter: E
Earnings per Share diluted
The companys earnings divided by the average number of shares outstanding for the period, giving effect to assumed dilution from outstanding stock options and restricted stock units. Earnings per Share

Financial Term Letter: E
Earnings per Share EPS Growth Rates
The percentage of EPS change within a specific period (Y/Y year on year; Seq sequential, from proceeding period; TTM trailing twelve months).

Fundamental Analysis Letter: E
Effective Tax Rate
Provision for income taxes as a percentage of earnings from continuing operations before income taxes and accounting changes. Does not represent cash paid for income taxes in the current accounting period. Also referred to as "actual tax rate" or "tax rate."

Financial Term Letter: E
EITF
Emerging Issues Task Force

Financial Term Letter: E
Electro Optic Materials
Electro-optic materials are materials that are engineered at the molecular level. Molecular level engineering is commonly referred to as "nanotechnology."

Manufacturing Term Letter: E
Electrolysis
A process of separating bonded elements and compounds by passing an electric current through them.

Manufacturing Term Letter: E
Electrolytic Plant
A plant that processes purifying metal ingots that are suspended as anodes in an electrolytic bath, alternated with refined sheets of the same metal which act as starters or cathodes.

Manufacturing Term Letter: E
Eligible Bank
A bank selected by Seller and approved by Buyer in writing and authorized to conduct trust and other banking business in any state in which Seller conducts operations.

Financial Term Letter: E
Eligible Swap Counterparty
means an entity, which may be an affiliate of a remarketing agent, engaged in the business of entering into derivative instrument contracts that satisfies the Rating Agency Condition.

Financial Term Letter: E

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fees and expenses charged by other investment companies in which the Fund invests a portion of its assets.

Financial Term
Acquisition
A business acquisition. The acquiring company records at its cost the acquired assets less liabilities assumed. The reported income of an acquiring company includes the operations of the acquired company from the date of acquisition.

Financial Term
Acquisition Proposal
means any merger, amalgamation, take-over bid, tender offer, arrangement, recapitalization, liquidation, dissolution, share exchange, material sale of assets (or any lease, long term supply agreement or other arrangement having the same economic effect as a material sale of assets) representing greater than 20% of the fair market value of the Arrangement, any sale of more than 20% of any class of

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Adjusted Average Cardmember Loans
Represents average cardmember loans on an owned or managed basis, as applicable, excluding the impact of deferred card fees, net of deferred direct acquisition costs of cardmember loans on an owned or managed basis, as applicable.

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ADR American Depositary Receipt
represents ownership in the shares of a non-U.S. company that trades in U.S. financial markets. ADRs enable U.S. investors to buy shares in foreign companies without the inconveniences of cross-border & cross-currency transactions. ADRs carry prices in US dollars, pay dividends in US dollars, and can be traded like the shares of US-based companies.

Financial Term
ADS American Depositary Share
represents ownership in the shares of a non-U.S. company that trades in U.S. financial markets. American Depositary Share representing one underlying Ordinary Share. ADS enable U.S. investors to buy shares in foreign companies without the inconveniences of cross-border & cross-currency transactions. ADS carry prices in US dollars, pay dividends in US dollars, and can be traded like the shares of U

Financial Term
Advised Lines of Credit
An authorization which specifies the maximum amount of a credit facility the Firm has made available to an obligor on a revolving but non-binding basis. The borrower receives written or oral advice of this facility. The Firm may cancel this facility at any time.

Financial Term
AICPA
American Institute of Certified Public Accountants

Financial Term
Allowance For Credit Losses
includes the allowance for loan and lease losses and the reserve for unfunded lending commitments, represents managements estimate of probable losses inherent in the Corporations lending activities. The allowance for loan and lease losses and the reserve for unfunded lending commitments exclude amounts for loans and unfunded lending commitments accounted for under the fair value option as the fair

Financial Term
Allowance For Loan and Lease Losses
The allowance for loan and lease losses represents the estimated probable credit losses in funded consumer and commercial loans and leases while the reserve for unfunded lending commitments, including standby letters of credit (SBLCs) and binding unfunded loan commitments, represents estimated probable credit losses on these unfunded credit instruments based on utilization assumptions. Credit expo

Financial Term
Alt-A Mortgage Loans
Alt-A loans are generally higher in credit quality than subprime loans but have characteristics that would disqualify the borrower from a traditional prime loan. Alt-A lending characteristics may include one or more of the following: (I) limited documentation; (II) high combined-loan-to-value ("CLTV") ratio; (III) loans secured by non-owner occupied properties; or (IV) debt-to-income ratio above n

Financial Term
Amortization
A charge against the companys earnings that represents the write off of intangible assets over the projected life of the assets. Cash Flow

Financial Term