MACD
Moving Average Convergence-Divergence
Margin
It is the amount paid by the customer when using a broker’s credit to buy or sell a security. Under Federal Reserve regulations, the initial margin required since 1934 has ranged from 40% of the purchase price up to 100%. Since 1974 the current rate of 50% has been in effect. Put writers are adversely affected by falling prices, call writers by rising prices. Consequently, the Options Clearing House calculates daily market movement in each option series. Favourable movements are credited to an option writer’s account. Unfavourable movement results in a margin call by OCH and requires the prompt lodgement of sufficient collateral to cover the potential loss.
Market capitalization
The total number of shares on issue multiplied by their market price. This can be applied to work out the market value of one company or of the value of all companies listed on the exchange.
Market maker
A dealer who maintain firm bid and offer prices in a given security by standing ready to buy or sell round lots at publicly quoted prices.
Mass ATI
Mass Account Transfer Instruction
MBO
management buy-out
Member
Chinese securities firm that has a membership on the Shanghai or Shenzhen Stock Exchange.
Merger
The amalgamation of two or more businesses into a single economic entity. Contrast takeover.
MESDAQ
Malaysian Exchange of Securities Dealing and Automated Quotation Bhd
MORC
Memorandum of Regulatory Cooperation
Mortgage Bond
A bond secured by a mortgage on a property. The value of the property may or may not equal the value of the bond issued against it.
MOU
Memorandum of understanding
MPF
Mandatory Provident Fund
MSCI Hong Kong Index
Morgan Stanley Capital International Hong Kong Index
Mutual Fund
A portfolio of stocks, bonds, or other securities administered by a team of one or more managers from an investment company who make buy and sell decisions on component securities. Capital is contributed by smaller investors who buy shares in the mutual fund rather than the individual stocks and bonds in its portfolio. The return on the fund’s holdings is distributed back to its contributors, or shareholders, minus various fees and commissions. This system allows small investors to participate in the reduced risk of a large and diverse portfolio that they could not otherwise build themselves. They also have the benefit of professional managers overseeing their money who have the time and expertise to analyze and pick securities. There are two types of mutual funds, open and closed ended. Shares in closed-end funds, some of which are listed on the New York Stock Exchange, are readily transferable in the open market and are bought and sold like other stock. These funds do not accept new contributions from investors, but only reinvest the return on the existing portfolio. Open-end funds sell their own new shares to investors, stand ready to buy back their old shares, and are not listed on exchanges. Open-end funds are so called because their capitalization is not fixed; they issue more shares as people want them. Many open ended funds allow contributors extra perks, such as the ability to write checks with their portion.
MWS
Multi-workstation System