earnings-at-risk A category of earnings risk measures.

earnings risk Risk due to uncertainty in future reported earnings.

East India Companies Several companies formed by European businessmen to exploit the spice trade of the 1600s.

ECO equity collateralized obligation.

economic capital Capital held for economic (as opposed to regulatory) purposes.

economic profit Profit in excess of the opportunity cost of capital.

economic value A generalization of market value.

economic value added Economic profit.

EDS Equity default swap.

effective Fed funds rate A dollar-weighted average of interest rates paid on overnight Fed funds.

efficient frontier A theoretical set of portfolios, each offering an optimal risk-reward tradeoff.

efficient market A market in which prices reflect all available information.

efficient market hypothesis A financial theory that markets are efficient in the sense that prices reflect all available information.

Eifuku Master Fund A Japanese hedge fund that failed in 2002.

eigenvalue A concept from linear algebra.

eigenvector A concept from linear algebra.

eligible (bankers acceptance) A bankers acceptance that satisfies requirements to be free of bank reserve requirements in the event it is sold.

Emerging market debt Debt issued by governments or corporations in countries whose economies are striving to emerge from under development.

employment practices liability insurance Protects against claims for wrongful dismissal, failure to promote, sexual harassment and other violations of employment or anti-discrimination laws.

empty set The set that contains no elements.

Engraftment An archaic practice for retiring government debt through a debt-for-equity swap.

Enron debacle In December 2001, energy trading powerhouse Enron filed for bankruptcy in the midst of an accounting scandal.

enterprise risk management The extension of financial risk management to non-financial risks.

EPL insurance Employment practices liability insurance.

equilibrium pricing model An asset pricing model based on economic arguments about how prices should behave to maintain market equilibrium.

equipment trust certificate Secured corporate debt issued through a trust to finance transportation equipment.

equity An ownership interest in something.

equity collateralized obligation A synthetic CDO structured exclusively with equity default swaps.

equity default swap A far out-of-the-money equity option structured much like a credit default swap.

equity financing Ownership that is securitized as stock that may be held by multiple investors and traded in secondary markets.

equity market neutral Market neutral equity trading strategy based primarily on fundamental analysis.

equivalent martingale measure A martingale measure that is equivalent to the "real world" probability measure.

equivalent measures Equivalent probability measures.

equivalent probability measures Probability measures that have the same null space.

ETL Expected tail loss.

Euler's formula An important formula of mathematics that relates the exponential, sine and cosine functions.

Euribor Euro interbank offered rate.

Euro CD A certificate of deposit issued outside a country but denominated in that country's currency.

Euro interbank offered rate Refers to indicative short-term interest rates available for the euro.

Euro medium-term note A debt instrument structured like a medium-term note and issued in the unregulated Euro markets.

Eurobond A bearer bond issued and traded within the largely unregulated Euromarket.

Eurocurrency Currency deposited in bank branches outside countries where it is the national currency.

Eurocurrency future Any of several available cash-settled futures on a 3-month Eurocurrency deposit.

Eurodollar A US dollar deposited with a bank branch outside the United States.

Eurodollar bundle A Eurodollar futures strip that can be traded as a single unit on the CME.

Eurodollar deposit A deposit of US dollars held at a bank branch outside the United States.

Eurodollar future A cash-settled future on a 3-month Eurodollar deposit.

Eurodollar futures strip A position consisting of an equal number of each of several consecutive quarterly Eurodollar futures.

Eurodollar pack A Eurodollar futures strip that can be traded as a single unit on the CME.

Eurodollar strip Eurodollar futures strip.

Euroeuro A deposit of European euros held at a bank branch outside any country where the euro is the national currency.

Euroeuro future A cash-settled future on a 3-month Euroeuro deposit.

European exercise A provision that permits exercise of an option only at expiration.

European financial regulation Linked article provides an overview.

Eurosterling A deposit of British pounds held at a bank branch outside the United Kingdom.

Eurosterling future A cash-settled future on a 3-month Eurosterling deposit.

Euroswiss A deposit of Swiss francs held at a bank branch outside Switzerland.

Euroswiss future A cash-settled future on a 3-month Euroswiss deposit.

Euroyen A deposit of Japanese yen held at a bank branch outside Japan.

Euroyen future A cash-settled future on a 3-month Euroyen deposit.

EVA Economic value added.

event driven strategy Speculative trading strategy that seeks to exploit relative mispricings between securities whose issuers are involved in mergers, divestures, restructurings or other corporate events.

ex-coupon Refers to a bond trading too late for the buyer to receive an upcoming coupon.

ex-coupon date The date on which a bond starts to trade ex-coupon.

ex-dividend Refers to a stock trading too late for the buyer to receive an upcoming dividend.

ex-dividend date The date on which a stock starts to trade ex-dividend.

ex-dock A method for settling physical commodity trades.

ex-warehouse A method for settling physical commodity trades.

exchange for physicals An alternative to physical settlement offered by many futures exchanges.

exchange traded Traded on a formal exchange such as the New York Stock Exchange or Chicago Board of Trade.

exempt security A security exempted from certain provisions of US securities laws.

exotic derivative A complicated or specialized derivative instrument.

expected default frequency Default probability calculated for a one-year horizon.

expected exposure The expected value of credit exposure at some future point in time.

expected loss Expected value of losses due to default over a specified horizon.

expected shortfall Expected tail loss.

expected tail loss A VaR metric indicating the expected portfolio loss conditional on that loss exceeding a specified quantile of loss.

expectation Expected value.

expected value A parameter indicating the "center of gravity" of a probability distribution.

expiration date The date on which an option expires.

expiration value The value of an option at expiration.

exposure at default Credit exposure to an obligor at the time of a default by that obligor.

exposure limit A risk limit based upon some exposure metric of risk.

extendible option An option whose expiration may be extended.

extraordinary mandatory redemption A provision requiring that a security be called if a specified event occurs.

extraordinary optional redemption A provision permitting a security be called if a specified event occurs.

extraordinary redemption A provision providing for a security to be called if a specified event occurs.

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