Face value

The redemption value of a bond.  Also known as par value.

Fannie Mae

See FNMA

FHA

Federal Housing Administration is responsible for the various mortgage insurance programs for the U.S. Department of Housing and Urban Development

FHLMC

Federal Home Loan Mortgage Corporation, pronounced Freddie Mac, is a government sponsored enterprise or GSE.  FHLMC is a public, shareholder owned company trading on the New York Stock Exchange.  FHLMC provides low-cost funds to mortgage lenders, which in turn lend to home buyers throughout the United States.  FHLMC supports the secondary mortgage market for conventional mortgages.  Put into conservatorship September 2008.

Fiduciary

A person who is legally authorized to supervise the investment portfolio of a third party and make investment decisions in accordance with the wishes of the beneficiary.  Examples of fiduciaries include executors of wills and estates, trustees, and those who administer the assets of the underage or incompetent beneficiaries.

Fixed Income Security

A marketable debt obligation where an issuer agrees to pay a certain amount of interest over the life of the security.

Fixed-for-floating rate swap

A swap in which one counterparty pays a floating rate of interest while the other counterparty pays a fixed rate of interest.  This is the most common type of swap.

Floating Rate Notes

Coupon adjusts periodically, such as every 3 to 6 months, over a financial index, such as Libor.

Floating-rate note (FRN)

A medium-term instrument with a coupon rate that floats up or down based upon changes to an index or reference rate. Often, FRNs are tied to LIBOR.

Floor

Also referred to as an interest rate floor.  A multi-period interest-rate option that provides a cash payment to the holder of the option whenever the reference rate is below the floor rate (also called the "floor" and sometimes the contract rate") on a fixing date.

FNMA

Federal National Mortgage Association, pronounced Fannie Mae, is a government sponsored enterprise or GSE.  FNMA is a public, shareholder owned company trading on the New York Stock Exchange.  FNMA provides low-cost funds to mortgage lenders, which in turn lend to home buyers throughout the United States.  FNMA supports the secondary mortgage market for both government insured and conventional mortgages.  Put into conservatorship September 2008.

Foreign exchange markets

See currency markets.

Forward contract

Also called a forward.  A Contract for deferred delivery traded in over-the-counter dealer-type markets.  Less standardized than a futures contract but more easily tailored to commercial users' idiosyncratic needs then futures.

Forward exchange rate

Current rate of exchange for a foreign exchange transaction scheduled to take place at a later date.  Also called a forward rate, but the latter term can also refer to a forward interest rate.

Forward rate agreement (FRA)

An interest-rate forward contract written on a notional principal and cash settled on the basis of the difference between the contract rate and the prevailing reference rate on the settlement date.  The resultant settlement value is discounted to adjust for an up-front settlement.

Forward swap

Also called a deferred swap.  A fixed-for-floating interest rate swap in which the swap coupon is set at the outset but the start of the swap is delayed.

Forward yield curve

A yield curve currently expected to prevail at some later date.  For example, a three-month forward yield curve graphically shows a series of 3 month forward rates. 

Freddie Mac

See FHLMC

FRN’s

See Floating Rate Notes

Future Value

The amount that a sum of money invested today, earning a simple or compounded interest, will be worth at a future date

Futures contract

Also known as futures.  Standardized contracts for deferred delivery (or cash settlement) of commodities and financial instruments.  Always traded  on a designated futures exchange and regulated in the U.S. by the Commodity Futures Trading Commission (CFTC).

Futures series

All futures contracts having identical terms (including the same delivery month) and trading on the same exchange constitute a series.

Futures strip

A series of futures contracts with successive delivery (settlement) months.  Most often used to refer to a series of interest-rate futures such as Eurodollars.