Explanations of "Gold" investment-related terms A to Z

The Correlation Matrix is a table that contains correlation coefficients among several markets (including precious metals) in different timeframes.

The CoT report enables investors to peek behind the scenes of the gold futures market and to better understand the psychology of the marketplace and, thus, get a better idea of futures moves on the gold market. This is because the COT report shows the net long or short positions of different types of traders.

The country risk premium refers to the difference between the higher interest rates that less stable and riskier countries must pay to attract investors, and the interest rates of an investor's home country.

The Consumer Price Index (CPI) measures changes in the price level of a market basket of consumer goods and services purchased by households, such as food, transportation, electricity etc. The CPI is calculated by taking price changes for each item in the basket of goods and averaging them with weights reflecting their shares in the total of the consumer expenditures covered by the index. There is also core CPI which excludes high volatility items, such as energy.

These days, we rate everything from movies to Uber drivers. The key rating for the economy is credit rating, which is an assessment of the creditworthiness of a borrower. It shows how likely the borrower is to repay its debt obligations. Credit ratings reveal the level of risk associated with investing in the debt of a particular entity. They can be assigned to any type of borrower: an individual, corporation, city, state, or sovereign government.

A credit spread (also called a yield spread) is a spread between two securities that are almost identical, except for the quality rating. Because Treasuries are considered practically risk-free, they constitute a benchmark to which other bonds are compared. Thus, credit spread usually shows a spread between Treasury securities and identical (except rating) non-Treasuries. In other words, credit spread indicates the risk premium for investing in one (risky) security over another (considered to have almost no risk). For example, private companies can default, so they must offer a higher return on their bonds, because their credit rating is worse than that of the U.S. government, which, allegedly, cannot go bankrupt.

What connects Cthulhu, a Doge meme, and Putin? Well, there are cryptocurrencies which refer to all of them. And what is even funnier is that the market capitalization of Dogecoin, which was developed just for fun, is almost $300 million (as of April 30, 2019). Isn't it strange? We all know that a Great Cthulhu deserves much more so that people waste electricity in his name rather than in the name of that dog!

Currency exchange rate is the value of one currency in relation to another. Currency exchange rates can be fixed or flexible. If you’ve traveled to foreign country, you have a first-hand experience of what currency exchange is all about. You basically trade American dollars for its equivalent in British pounds, Japanese yen, Mexican peso, or any other currency. There are a variety of factors that will affect currency exchange rates. In this section, we’ll give you an overview on how currency exchange rates work:

It starts innocently. You just try to weaken the currency a little to make exports more competitive and to boost the economic growth. You intervene directly in the foreign exchange market, cut interest rates or engage in quantitative easing, just to improve a bit your economic position on the global stage. But before you know it, other countries do the same and you are in the middle of currency wars.

A cycle is a situation or process where something is regularly repeated with the passing of time. Seasons are the most straightforward examples of cycles: after spring is summer, then autumn, winter and once again spring, etc. Other cycles found in nature include days and nights.

A tendency is something likely to happen, although it is not certain that it will happen. Cyclical tendencies are phenomena that are likely to happen regularly, even though there is no guarantee.