U.S. Treasury Bill (T Bill)
| The shortest-term instrument issued by the federal government. The maturities of these discounted issues do not exceed one year at issuance, with three-month (90-day) or six-month (180-day) paper being very common.
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U.S. Treasury Bond (T Bond)
| The longest-term debt of the federal government, issued in coupon form for period of 10 to 30 years.
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Underlying
| The security on which options are being bought or sold.
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Underlying Commodity
| The commodity or futures contract on which a commodity option is based, and which must be accepted or delivered if the option is exercised. Also, the cash commodity underlying a futures contract.
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Underlying Futures Contract
| The specific futures contract that may be bought or sold by the exercise of an option.
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Underlying Instrument
| The instrument (underlying futures contract) which would be delivered, if the option was exercised.
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Underlying Security
| The security on which options are being bought or sold.
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Underwriter
| A firm that purchases new issues and distributes them. When issues trade refers to a trade during a time interval when a new issue is sold and actually distributed. Until the issue is distributed, it trades on a "when, as, and if issued" basis.
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Underwriter (Investment Banker)
| In a municipal underwriting, a brokerage firm or bank that acts as a conduit by taking the new issue from the municipality and reselling it. In a corporate offering, the underwriter must be a brokerage firm.
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Underwriting
| The process by which investment bankers bring new issues to the market.
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Underwriting Manager
| (1) In a negotiated underwriting, the investment banker whose client is the corporation wanting to bring out a new issue. (2) In a competitive underwriting, the lead firm in a group that is competing with other group(s) for a new issue.
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Uniform Gift to Minors Accounts (UGMA)
| A method of securities ownership whereby parents or other relatives may contribute cash or securities to children. Portions of returns generated by the securities are taxed at the children’s tax bracket instead of parents’ presumably higher bracket.
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Uniform Practice Code
| Part of the NASD rules that govern the dealing of firms with each other.
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Unit
| At issuance, a "package" of securities, such as a bond and warrant, which become separable at a later date.
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Unit Investment Trust
| An investment company organized under a trust indenture that sells interest in its portfolio in terms of redeemable securities.
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Unit Trust
| Similar to a mutual fund. A portfolio of securities, including mortgage-backed securities, offered by a brokerage or mutual fund.
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Unlisted Securities Market (USM)
| The Exchange's market for medium-sized companies which do not qualify for, or do not wish to have a full listing.
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Unlisted Security
| (1) A security which has not been admitted to the Stock Exchange's Daily Official List. Usually the issuer will be an unlisted company, but not always; it is not uncommon for a company to apply for its Ordinary Shares to be listed but not its loan stocks, or vice versa. (2) A security traded on the USM.
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Unwind
| An advanced option order that is used with the intention of closing an existing Buy/Write or Sell/Write position.
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Uptick
| A new price quote that is higher than the preceding quote for the same currency.
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Uptick Rule
| In the U.S., a regulation which states that a security may not be sold short unless the trade prior to the short sale was at a price lower than the price at which the short sale is executed.
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US Prime Rate
| The interest rate at which US banks will lend to their prime corporate customers.
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