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Purchasing-power risk
Related: inflation risk
Pure-discount bond
A bond that will make only one payment of principal and interest. Also called a zero-coupon bond or a
single-payment bond.
Pure expectations theory
A theory that asserts that the forward rates exclusively represent the expected future rates. In other words,
the entire term structure reflects the markets expectations of future short-term rates. For example, an
increasing slop ti the term structure implies increasing short-term interest rates. Related: biased
expectations theories
Pure glossary fund
A portfolio that is managed so as to perfectly replicate the performance of the market portfolio.
Pure yield pickup swap
Moving to higher yield bonds.
Put
An option granting the right to sell the underlying futures contract. Opposite of a call.
Put/call parity
Applies to derivative products. Option pricing law that says, given a stocks price, a put and call of the same
class must have a static price relationship due to arbitrage opportunities that would reinstate this
relationship.
Put an option
To exercise a put option.
Put away
Used in the context of general equities. Buy interest.
Put bond
A bond that the holder may choose either to exchange for par value at some date or to extend for a given
number of years. If the price is above par, the put is a premium put.
Put-call parity relationship
The relationship between the price of a put and the price of a call on the same underlying security with the
same expiration date, which prevents arbitrage opportunities. Holding the stock(s) and buying a put will
deliver the exact payoff as buying one call and investing the present value (P.V.) of the exercise price. The
call value equals C=S+P-PV(k).
Put it on
Used for listed equity securities. Go to the floor to transact. See: print.
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