Guide to Analysing Companies

Global custody
A service for the worldwide settlement and safekeeping of se-
curities. The industry sprang up in 1974 when the employee
retirement income security act became law in the
United States, forcing US pension funds to separate the man-
agement from the custody of the underlying investments. The
term “global custody” was coined by Chase Manhattan Bank,
which first designed services to satisfy the new law. In those
days custodians helped investors to buy, sell and hold securities
from a handful of foreign markets; these days it could be as
many as 100 markets. With more and more countries encourag-
ing employees to build up their own pensions through diver-
sified holdings of bonds and equities held in unit trusts
(mutual funds) and other forms of collective investment, the
business of global custody is likely to grow bigger still.
Global market
A market for goods or services that attracts buyers from all over
the world. The idea that there might be a global market for ev-
erything from Mars bars to mortgages was first popularised
during the 1980s. However, many financial markets were global
long before that.
 Customers of banks in London and New York come
from all over the world in search of capital, advice and
trade finance.
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 lloyd’s of London has long insured risks (especially
those at sea and in the air) throughout the world.
 Hard commodities (metals of one sort or another) and
soft commodities (tea, coffee, wheat and the like) from
all over the world have long been bought and sold in
London and other international financial centres.
Gold
The precious metal that individuals most like to hoard when
they feel uncertain about the value of money or other forms of
investment. central banks still hold some of their country’s
reserves in the yellow metal. The biggest store of gold is be-
lieved to be 80ft below the streets of Manhattan.
For much of the 19th century the UK had a monetary system
that was based on gold (the so-called Gold Standard). notes
and coins were freely convertible into their worth in gold by
the central bank; gold was also exported and imported freely to
settle accounts between the central banks of different countries.
The Gold Standard was finally abandoned in 1914 at the out-
break of the first world war. One of the problems of using gold
in this way was its inflexibility: the growth in world trade was
restricted by the world’s ability to produce more gold.
Accursed greed for gold,
To what dost thou not drive the heart of man.
Virgil, 
Aeneid
Gold card
A plastic card, such as a credit card or debit card, which
offers additional services to those available from the basic
version of the card. Gold cards are aimed at high earners who
are also high spenders. Most require applicants to have a
minimum income, as do platinum cards, which are touted as
being better still.