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 Welcome to Firstrade's stock market glossary. Do all the research you want. Use this glossary to look up any financial term.
- F - Factor The amount of mortgages remaining in a pool of mortgage-backed securities as represented by a decimal between 0 and 1. Factor Table A table used to compute the outstanding principal on pass-through securities including Ginnie Mae, Freddie Mac and Fannie Mae. Fannie Mae See Federal National Mortgage Association. Fast Market A market condition where a large number of orders for a particular security are received within a short period of time, faster than what market makers can handle effectively. These situations are usually the results of unexpected news and may lead to price volatility. Fed See Federal Reserve Board. Federal Farm Credit System An issuer of agency securities, established by Congress to provide credit for farms and farm-related enterprises. Federal Funds Rate The interest rate that banks charge each other for the use of Fed funds. The Feds control this rate indirectly through setting the yield of Treasury security issues. Federal Home Loan Mortgage Corporation (FHLMC) Also known as Freddie Mac, it is a government-chartered corporation created with the goal of strengthening the existing secondary market in residential mortgages. Federal Housing Administration (FHA) A government-sponsored agency that provides a system of mutual mortgage insurance for buyers of homes and mortgage-lending institutions. Federal National Mortgage Association (FNMA) Also known as Fannie Mae, a congressionally-chartered corporation created to provide liquidity to mortgage investments. It does this by purchasing mortgages on the secondary market, pools them, then sells them as mortgage backed securities to investors. Federal Reserve Board The 7 member board governing the Federal Reserve System, board members are appointed by the President to serve 14-year terms. The actions of the Feds help shape government monetary policy, most notably interest rates and the U.S. economy. Federal Reserve System The nation's central monetary authority and the Treasury Department's agent for selling new Treasuries. FHA See Federal Housing Administration. FHA Experience An estimate of the average life of a pool of mortgage-backed securities in relation to experience tables developed by the Federal Housing Administration. FHLMC See Federal Home Loan Mortgage Corporation. Fill or Kill (FOK) An order instruction requesting the immediate execution of the entire order quantity at the specified price. If not, then the order is automatically cancelled. Financial Industry Regulatory Authority (FINRA) (formerly known as National Association of Securities Dealers or NASD) FINRA, a nonprofit, self-regulating association supervised by the Securities and Exchange Commission (SEC), sets standards and establishes rules for the way that its members, including brokerage firms active in the over-the-counter (OTC) market and investment banks, operate. FINRA is responsible for licensing of individuals and brokerage firms. FINRA also has the authority to discipline members who violate those standards. Among FINRA's other responsibilities are reviewing and approving sales and marketing literature that its members use to promote their products. The goal is to protect investors from misleading information on the risks and rewards of investing. Fiscal Agent The authority responsible for issuing new agency securities. Fiscal Year The twelve-month period during which businesses or the government maintain financial records. This cycle does not necessarily coincide with the calendar year, therefore it is known as the fiscal year. Fixed Annuity Guaranteed payments of a specified fixed dollar amount annually for the period covered under the contract. Flat A security position that is neither long nor short in a portfolio. Flat (Bonds) A bond trading without accrued interest is said to be trading "flat". Floor Broker An exchange member permitted to conduct business on the exchange floor. Flotation A company's shares offered on the market for the first time. FNMA See Federal National Mortgage Association. FOK See Fill-or-Kill. Footsie See FT-SE 100 Share Index. Freddie Mac See Federal Home Loan Mortgage Corporation. Free Cash Flow Free cash flow is calculated as operating cash flow minus capital expenditures and dividends. Free cash flow can be used to pay dividends, buy back stock or pay off debt. Free Cash Flow per Share Free cash flow divided by the number of common shares outstanding. Free Stock The securities that can be used for a loan. Friendly Takeover A takeover supported by the target company's management and board members. Frozen Account An account that had failed to make timely payments in the past, thereby requires all purchases to be paid for in cash in advance for a period of 90 days. FT Index The Financial Times Industrial Ordinary Share Index, composed of 30 stocks chosen to be representative of British industry, excluding government stocks, banks and insurance companies. The index is calculated hourly during the day with a "closing index" at 4:30 p.m. FT-SE 100 Share Index Popularly known as "Footsie", this index of 100 leading UK shares listed on the London Stock Exchange providing an overview of how the UK stock markets are performing. Fully Diluted Earnings per Share Earnings per share expressed as though all outstanding convertible securities and warrants have been exercised. Fully Diluted Shares Outstanding All shares outstanding, including common stock, warrants, and convertible securities. Fund Exchange Ability to shift a mutual fund investment from one fund to another within same mutual fund family. Fund Family The group of mutual funds managed by a single company. Fundamental Analysis The security valuation method involving the analysis of the company's financials and operations, especially sales, earnings, growth potential, assets/ debt ratio, management, and competition. This valuation method seeks to find the intrinsic value of a company, and locate undervalued stock in the market. Futures An agreement to buy or sell a set amount of a commodity or financial instrument at a certain price on a predetermined date. Futures Contract Agreement to buy or sell a set number of shares of a specific stock in a predetermined future month at a price agreed upon by both sides of the transaction. The contracts themselves are traded on the futures market. The difference between a futures contract and an options contract is that the futures contract is an agreement to actually make a transaction, whereas the option contract is the right to buy or sell.
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