MARKET STRUCTURE DICTIONARY

ultimate low  The lowest price a customer is willing to sell stock.  Usually implies that the limit price is lower than the current best bid.  For example, XYZ, take 25,000 for sale with an ultimate $50 low, but you don’t need to take it there.

ultimate top  The highest price a customer is willing to pay for stock.  Usually implies that the limit price is higher than the current best offer.  For example, ZVZZT, buy 75,000 with an ultimate $25 top, just work.

unbundling  Paying separately for research and trading services.  Usually refers to the payment arrangement between an institutional investor and a broker/dealer.

unchanged  Describes a stock or a market whose price is the same in the current time period as it was in the prior time period.  For example, The market ended the day unchanged after being down more than two percent at one point.

unch'ed  An abbreviation of unchanged, as in If we could make it back to unch'ed on the day, it would be a huge win.

under my belt  Industry jargon meaning "purchased for a long position."  For example, I've already got 50,000 XYZ under my belt, and I've probably got another 50,000 to buy.

underlying (asset)  The actual asset upon which the value of a derivative instrument is based.   

underperform  To achieve less favorable returns than a specified benchmark.  For example, XYZ has really underperformed this quarter.  We may have to think about trimming our position.

undertone  The inherent strength or weakness in a market. 

undervalued  Describes a stock that is perceived to trade at a relatively cheap price.  For example, ZVZZT looks seriously undervalued at these levels.  I'm a buyer.

undigested  Describes a situation in which newly issued shares fail to sell during the distribution due to lack of investor demand.

undisclosed order  An order residing in an alternative trading system that is available for execution but is not visible to other market participants.

undo a bargain  An old London term for close a position.

uneven lot  Another term for odd lot.

Uniform Securities Agent State Law Exam  An examination required by many states to be licensed in that state as a registered representative.  Also known as the Series 63 exam.

uninformed trader  An academic term for a trader who is either incapable of discerning, or simply does not care to know. the fundamental value of the instruments he trades.  See also UTILITARIAN TRADER.   

unit  A bundle of more than one class of security that trades together. 

unit of trading  See trading unit.

universe  A group of stocks that possess common properties.  Also known as a space.  See also SECTOR.

unlisted security  A security that does not trade on an organized stock exchange.  An over-the-counter stock.

unlisted trading  Trading stocks on a particular exchange that are not officially listed on that exchange. 

unlisted trading privileges  Regulations in the Securities Exchange Act of 1934 that permit securities listed on any national securities exchange to be traded on other national securities exchanges as well. 

unload  Sell stock quickly into a declining market without particular regard to price or market impact.  For example, I need to unload this XYZ position ASAP.  Somebody please find me a buyer.

unsolicited order  An order that results from communication that was initiated by a customer rather than by a broker/dealer.  See also SOLICITED ORDER.

unwind a trade  Another term for close a position, as in I think we should start to unwind ZVZZT over the next day or so.

up  1.  Dealer term indicating that the size stated in a two way quote is good for the bid as well as the offer, as in ZVZZT, I'm $25 1/4 at a 1/2, 50,000 up.  Also known as either way.  2. Equivalent to on the tape, as in ZVZZT, put the 50,000 up at $25.05 or ZVZZT, you're up on 50,000.  3.  Indicates a value that is higher in one time period than it was in a prior time period, as in The market has been up every day this week.

up market  A market trending higher.

upside  Potential gain. 

upstairs  1.  An abbreviation of upstairs market, as in The customer says its okay to go ahead an put the XYZ trade on upstairs.  2.  A broker/dealer’s listed trading desk.  As opposed to the floor operation.

upstairs market  1.  Specifically, another term for THRID MARKET as it describes the trading of exchange listed securities in the over-the-counter market.  However, the term upstairs market often has more of an institutional trading connotation.  In this context, the upstairs market is basically a communications network that connects broker/dealer trading desks and institutional trading desks.  It parallels the traditional stock exchanges and is used primarily to privately negotiate and/or execute institutional block trades in exchange listed stocks away from the exchange itself. 2) More generally, a communications network that connects broker/dealer trading desks and institutional trading desks globally for the purpose of trading financial instruments (including listed equities, NASDAQ equities, options, futures, swaps, ETFs, etc.) in the over-the-counter market.  

upstairs trade  A trade executed in the UPSTAIRS MARKET. 

upstairs trader  1.  In general, any trader who operates in the upstairs market.  2.  More specifically, a listed trader on a broker/dealer's trading desk.  May send orders to the floor for execution as well as trade in the upstairs market.  As opposed to a FLOOR TRADER.

upswing  A rally in prices following a period of flat or declining prices, as in I think we may see a real upswing in the market if a couple of the leaders start to report solid earnings.

uptick  1.  A price that is higher than the price of the previous trade.  2.  A bid that higher than the previous best bid.  Also called plus tick.

uptick rule  A Securities and Exchange Commission regulation that, when in force, stipulates that short sales are only allowed on an uptick or zero plus tick. 

uptrend  A stock or a market that exhibits net increasing prices.  For example, This uptrend has been going on for so long now that it really feels like the time is ripe for a reversal.

use  An expressed desire to own stock, as in ZVZZT, I can use 50,000 shares in line.