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Used in the context of general equities. Change the price or volume levels at which a stock trades through
artificial, extraordinary, or non-fundamental demand or supply (i.e., corporate repurchase).
Efficiency
The degree and speed to which a market accurately incorporates information into prices.
Efficient capital market
A market in which new information is very quickly reflected accurately in share prices.
Efficient diversification
The organizing principle of modern portfolio theory, which maintains that any risk-averse investor will search
for the highest expected return for any level of portfolio risk.
Efficient frontier
The combinations of securities portfolios that maximize expected return for any level of expected risk, or that
minimizes expected risk for any level of expected return. Pioneered by Harry Markowitz.
Efficient Market Hypothesis
In general the hypothesis states that all relevant information is fully and immediately reflected in a securitys
market price thereby assuming that an investor will obtain an equilibrium rate of return. In other words, an
investor should not expect to earn an abnormal return (above the market return) through either technical
analysis or fundamental analysis. Three forms of efficient market hypothesis exist: weak form (stock prices
reflect all information of past prices), semi-strong form (stock prices reflect all publicly available information)
and strong form (stock prices reflect all relevant information including insider information).
Efficient portfolio
A portfolio that provides the greatest expected return for a given level of risk (i.e. standard deviation), or
equivalently, the lowest risk for a given expected return.
Efficient set
Graph representing a set of portfolios that maximize expected return at each level of portfolio risk.
Eighth[-ed]
Used in the context of general equities. A Specialist or another broker is bidding higher or offering lower than
we are, often topping or undercutting us by an eighth.
Either/or facility
An agreement permitting a bank customer to borrow either domestic dollars from the banks head office or
Eurodollars from one of its foreign branches.
Either-or order
Used in the context of general equities. See: Alternative order.
Either-way market
In the interbank Eurodollar deposit market, an either-way market is one in which the bid and offered rates
are identical.
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