Earnings Per Share:
A company's profit allocated to each share of common stock after paying taxes, preferred shareholders and bondholders. Under rules adopted in 1998, companies must report basic earnings per share. Also, companies must report diluted earnings per share, which does not include convertible securities, stock options, or warrants.

Effective Tax Rate:
The tax rate paid by a taxpayer. This is computed by dividing taxes paid for a given year by taxable income for that year.

Equity:
1.Represents stockholders' ownership interests in a corporation.
2. Difference between the securities owned and the margin loans owed in a margin account. It is the amount the investor would keep after all positions have been closed and all margin loans paid off.

Equity Option:
An option on shares of an individual common stock.

Equivalent Strategy:
investment strategy that has the same risk-reward profile as another investment strategy. E.g.: Long May 60-65 call vertical spread is equivalent to a short May 60-65 put vertical spread. See also SYNTHETIC POSITIONS.

Exchange:
Any exchange or group of persons that provides a central location where securities can be bought and sold. An exchange does not have to be a physical place as demonstrated by a network of securities dealers connected by a computer link called NASDAQ (National Association of Securities Dealers Automated Quotation System). 'Listed' stocks are traded or 'listed' on a particular exchange such as the NYSE (New York Stock Exchange) and are characterized by three letter stock symbols while OTC stocks are traded through the NASDAQ system and are usually characterized by four letter stock symbols.

Exchange Maintenance Requirement:
Margin maintenance requirements as defined by NASD rule 2520. The JB Oxford & Company margin exceptions do not apply to Exchange requirements.

Ex-dividend Date:
On the ex-dividend date, the previous day's closing price is reduced by the amount of the dividend (rounded up to the nearest eighth) because purchasers of the stock on the ex-dividend date will not receive the dividend payment. This date is sometimes referred to simply as the "ex-date," and can apply to other situations; for example, splits and distributions. If you purchase a stock on the ex-date for a split or distribution you are not entitled to the split stock or that distribution. However, the opening price for the stock will have been reduced by an appropriate amount, as on the ex-dividend date. Weekly financial publications, such as Barron's, often include a stock's upcoming "ex-date" as part of their stock tables.

Exercise price:
See STRIKE PRICE.

Exercise:
To invoke the rights granted to the owner of an option contract. In the case of a call, the option owner buys the underlying stock. In the case of a put, the option owner sells the underlying stock.

Expiration Date:
The date on which an option and the right to exercise it cease to exist. Options expire the Saturday, following the third Friday of every month.

Expiration Month:
The month during which the expiration date occurs.

Expiration Time:
The time of day by which all exercise notices must be received on the expiration date. Check with your Account Executive regarding your brokerage firm's deadline for submitting exercise notices on expiration Friday.

Extended Hours Trading:
An extended trading session beyond 4:00 EST (on a matched order basis) for NYSE and AMEX