An agent, often a member of a stock exchange firm, who executes public orders to buy and sell securities and commodities. For this service a commission is usually charged. Brokers are agents working on commission and not principals or agents acting on their own account.
Brokerage fee
A fee charged by a broker for executing a transaction.
Broker–dealer
Bulge
A rapid price advance.
Bull
An investor who believes that prices are going to rise.
Bull market
A prolonged period of generally rising prices.
Bull spread
An option position composed of both long and short options of the same type, either calls or puts, designed to be profitable in a declining market. An option with a lower strike price is bought and one with a higher strike price is sold.
Bulldogs
Sterling bonds issued in the UK by foreign institutions.
Butterfly spread
(i) A futures butterfly spread is a spread trade in which multiple futures months are traded simultaneously at a differential. The trade basically consists of 2 futures spread transactions with either 3 or 4 different futures months at one differential. (ii) An options butterfly spread is a spread trade in which multiple options months and strike prices are traded simultaneously at a differential. The trade basically consists of 2 options-spread transactions with either 3 or 4 different options months and strikes at one differential.
Buyer/taker
The purchaser of an option, whether a call or put option. The buyer may also be referred to as the option holder. Option buyers receive the right, but not the obligation, to enter a futures/securities market position.
