Definition of World Trade Organization (WTO)

World Trade Organization (WTO)

the arbiter of global trade that was created in 1995 under the General Agreement on Tariffs and trade; each signatory country has one
vote in trade disputes

Balance of trade

Net flow of goods (exports minus imports) between countries.

Basket trades

Related: Program trades.

Block trade

A large trading order, defined on the New York Stock Exchange as an order that consists of
10,000 shares of a given stock or a total market value of $200,000 or more.

Counter trade

The exchange of goods for other goods rather than for cash; barter.

Flat trades

1) A bond in default trades flat; that is, the price quoted covers both principal and unpaid,
accrued interest.
2) Any security that trades without accrued interest or at a price that includes accrued
interest is said to trade flat.

Floor trader

A member who generally trades only for his own account, for an account controlled by him or
who has such a trade made for him. Also referred to as a "local".

Forward trade

A transaction in which the settlement will occur on a specified date in the future at a price
agreed upon the trade date.

Informationless trades

trades that are the result of either a reallocation of wealth or an implementation of an
investment strategy that only utilizes existing information.

Information-motivated trades

trades in which an investor believes he or she possesses pertinent
information not currently reflected in the stock's price.

International Bank for Reconstruction and Development - IBRD or World Bank

International Bank for Reconstruction and Development makes loans at nearly conventional terms to countries for projects of high
economic priority.

OPEC (Organization of Petroleum Exporting Countries)

A cartel of oil-producing countries.

Plan for reorganization

A plan for reorganizing a firm during the Chapter 11 bankruptcy process.

Posttrade benchmarks

Prices after the decision to trade.

Pre-trade benchmarks

Prices occurring before or at the decision to trade.

Program trades

Also called basket trades, orders requiring the execution of trades in a large number of
different stocks at as near the same time as possible. Related: block trade

Publicly traded assets

Assets that can be traded in a public market, such as the stock market.

Registered trader

A member of the exchange who executes frequent trades for his or her own account.

Reorganization

Creating a plan to restructure a debtor's business and restore its financial health.

Reversing trade

Entering the opposite side of a currently held futures position to close out the position.

Society for Worldwide Interbank Financial Telecommunications (SWIFT)

A dedicated computer network to support funds transfer messages internationally between over 900 member banks worldwide.

Spot trade

The purchase and sale of a foreign currency, commodity, or other item for immediate delivery.

Terms of trade

The weighted average of a nation's export prices relative to its import prices.

Thinly traded

Infrequently traded.

Trade

A verbal (or electronic) transaction involving one party buying a security from another party. Once a
trade is consummated, it is considered "done" or final. Settlement occurs 1-5 business days later.

Trade acceptance

Written demand that has been accepted by an industrial company to pay a given sum at a future date.
Related: banker's acceptance.

Trade credit

Credit granted by a firm to another firm for the purchase of goods or services.

Trade date

In an interest rate swap, the date that the counterparties commit to the swap. Also, the date on
which a trade occurs. trades generally settle (are paid for) 1-5 business days after a trade date. With stocks,
settlement is generally 3 business days after the trade.

Trade debt

Accounts payable.

Trade draft

A draft addressed to a commercial enterprise. See:draft.

Trade on top of

trade at a narrow or no spread in basis points relative to some other bond yield, usually
Treasury bonds.

Trade house

A firm which deals in actual commodities.

Traders

Persons who take positions in securities and their derivatives with the objective of making profits.
traders can make markets by trading the flow. When they do that, their objective is to earn the bid/ask spread.
traders can also be of the sort who take proprietary positions whereby they seek to profit from the directional
movement of prices or spread positions.

Uptick trade

Related:Tick-test rules

World Bank

A multilateral development finance agency created by the 1944 Bretton Woods, New
Hampshire negotiations. It makes loans to developing countries for social overhead capital projects, which are
guaranteed by the recipient country. See: International Bank for Reconstruction and Development.

World investible

wealth The part of world wealth that is traded and is therefore accessible to investors.

network organization

a flexible organization structure that
establishes a working relationship among multiple entities,
usually to pursue a single function

North American Free Trade Agreement (NAFTA)

an agreement among Canada, Mexico, and the United States establishing the North American Free trade Zone, with a resulting reduction in trade barriers

organizational culture

the set of basic assumptions about
the organization and its goals and ways of doing business;
a system of shared values about what is important and
beliefs about how things get accomplished; it provides a
framework that organizes and directs employee behavior
at work; it describes an organization’s norms in internal
and external, as well as formal and informal, transactions

organizational-level cost

a cost incurred to support the ongoing
facility or operations

organizational structure

the manner in which authority and
responsibility for decision making is distributed in an entity

organization chart

a depiction of the functions, divisions,
and positions of the people/jobs in a company and how
they are related; it also indicates the lines of authority and
responsibility

organizational form

an entity’s legal nature (for example,
sole proprietorship, partnership, corporation)

reorganization

Restructuring of financial claims on failing firm to allow it to keep operating.

trade-off theory

Debt levels are chosen to balance interest tax shields against the costs of financial distress.

Balance of Merchandise Trade

The difference between exports and imports of goods.

Balance of Trade

See balance of merchandise trade.

Free Trade

The absence of any government restrictions, such as tariffs or quotas, on imports or exports.

Terms of Trade

The quantity of imports that can be obtained for a unit of exports, measured by the ratio of an export price index to an import price index.

Trade Deficit

Deficit on the balance of merchandise trade.

World Bank

The International Bank for Reconstruction and Development, an international organization that provides long-term loans to developing countries to improve their infrastructure.

Trade Loading

A term used for channel stuffing in the domestic tobacco industry.

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