Financial Dictionary

An earnings call is a conference call in which a company's management discusses its results and answers analysts' questions. Comments on outlook can move the share price as much as the results themselves.

Earnings guidance is a company's own forecast of future revenue or profit. Changes to guidance often move share prices more than the latest results.

Earnings per share is a company's net profit divided by the number of shares in issue. It is one of the most watched figures in quarterly results.

Earnings season is the period each quarter when most listed companies report their results. Share prices and indices can move sharply as results beat or miss forecasts.

An earnings surprise is when a company's reported profit differs from analysts' forecasts. Large surprises in either direction often cause sharp share price moves.

EBITDA stands for earnings before interest, taxes, depreciation and amortisation. It shows operating profit before financing and accounting choices, but it ignores spending needed to maintain the business.

An economic calendar lists upcoming data releases, central bank meetings and other scheduled events, with forecasts and previous figures. Traders use it to prepare for periods of higher volatility.

An economic indicator is a statistic that shows how an economy is performing, such as GDP, inflation or unemployment. Releases that differ from forecasts tend to move markets the most.

EIA crude oil inventories is the weekly change in US commercial crude stocks reported by the Energy Information Administration, usually on Wednesdays. A bigger than expected draw tends to support oil prices.

Elliott Wave theory holds that markets move in repeating patterns of five waves with the trend and three waves against it. Wave counts are open to interpretation, so analysts often disagree.

Emerging markets are economies that are growing and industrialising, such as India, Brazil, Indonesia and Mexico. Their assets can offer faster growth but are often more volatile and sensitive to the US dollar.

Energy commodities include crude oil, natural gas, heating oil and gasoline. Geopolitics, weather, OPEC+ decisions and inventory data drive their prices.

Enterprise value is a company's market capitalisation plus its debt minus its cash. It estimates what it would cost to buy the whole business.

An entry point is the price at which a trader opens a position. A clear entry rule, set in advance, helps avoid chasing moves.

Account equity is the account balance plus or minus the profit or loss on open positions. It shows what the account would be worth if every position were closed now.

ESG stands for environmental, social and governance factors used to assess how a company manages risks beyond its finances. Fund flows based on ESG criteria can affect demand for certain shares.

Ethereum is a blockchain that runs smart contracts, and ether is its native token, the second largest cryptocurrency. It moved from proof of work to proof of stake in 2022.

EUR/USD is the exchange rate between the euro and the US dollar, and the most traded currency pair in the world. ECB and Federal Reserve policy are its main drivers.

The euro is the shared currency of the eurozone and the second most traded currency after the US dollar. European Central Bank policy and eurozone data drive its value.

The Euro Stoxx 50 tracks 50 of the largest companies in the eurozone. It is the main benchmark for eurozone blue chip stocks.

The European Central Bank sets interest rates for the countries that use the euro. Its main goal is to keep inflation close to 2%, and its decisions move the euro and European bond markets.

The eurozone is the group of European Union countries that use the euro as their currency. The European Central Bank sets one interest rate for all of them.

An evening star is a three candle bearish reversal pattern: a strong rising candle, a small candle that gaps higher, then a strong falling candle. It suggests an uptrend may be ending.

The ex dividend date is the first day a share trades without the right to its next dividend. Traders who buy on or after this date do not receive that payment, and the price usually drops by about the dividend amount.

An exchange rate is the price of one currency in terms of another. It moves with interest rates, inflation, trade flows and risk sentiment.

An exchange traded fund is a fund that trades on a stock exchange like a share and usually tracks an index, sector or commodity. ETFs offer exposure to a whole market through one instrument.

An exit strategy sets out in advance when a trader will close a position, both for a profit and for a loss. It usually includes a stop loss and a profit target.

An expiry date is the date on which a futures contract, or a CFD based on one, ends. Positions are either closed or rolled into the next contract before then.

An exponential moving average gives more weight to recent prices than older ones. It reacts faster to price changes than a simple moving average of the same length.