Investment bankers and specifically, traders, use a large repertoire of codewords and slang to speed up the process in a role where being first can be everything. A mixture of Cockney rhyming slang, market banter and expressions picked up from horse racing bookmakers makes up the basis for a financial lingua franca that may sound like nonsense to most people, but has dominated the $4 trillion a day foreign exchange (FX) market for decades.
We’ve picked our favourite, top ten investment banking idioms. If you’re considering a role in banking, you may want to brush up on these expressions...
Cable: GBP (Great British Pound) vs USD (US Dollar) exchange rate
‘Cable’ is a term used by forex traders to refer to the exchange rate between the pound and dollar. The term derives from the Transatlantic Cable, a steel cable laid under the Atlantic Ocean in 1858 which telegraphically linked the UK and the US, enabling messages with currency prices to be transmitted between the London and New York Exchanges.
Loonie: The Canadian dollar
The ‘Loonie’ comes from the picture of a Loon, a water fowl, on the $1 coin. And so, unsurprisingly perhaps, a $2 coin is called a ‘twonie’!
A Prince Charles: Twelve contracts
Originally, a 12 contract lot was known as "one doz" - short for one dozen. However, because the term sounds similar to ‘one does’, it quickly became known as a Prince Charles – playfully mocking the speech of the Royal Prince.
A Bag: 1000 contracts
This term derives from the Cockney rhyming slang "a bag of sand is a grand” to denote 1000 contracts.
A Yard: 1 billion
The French word for ‘billion’ is ‘milliard’ which has been shortened to yard.
Dead cat bounce
When the price of a product, usually a security, has been falling for a long time, and has one last small upturn before finally collapsing.
A broker's electronic order book which they run side by side with voice trading
Mine / Yours
An order to buy (mine) or sell (yours)
When a trader enters a much bigger trade than intended, for example, one million contracts instead of one thousand contracts, resulting in a large market move.
The Old Lady: The Bank of England
Dating back to the 1797 James Gillray depiction of William Pitt the Younger, the prime minister of the day, attempting to woo the Bank of England, who is depicted as an old lady wearing a dress of £1 notes (image above). The Bank of England has been affectionately referred to as The Old Lady ever since.
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