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E

efficient frontier
A graph with risk and return on the horizontal and vertical axes that depicts the return characteristics of a portfolio given different weightings of its assets. An ideal portfolio lies on the upper line of the graph. Anything below the Efficient Frontier is inefficient, as a portfolio exists with either a higher return at the same level of risk, or lower risk at the same level of return.

equalization
An accounting methodology designed to insure that the investment manager is paid the correct incentive, performance, or profit sharing fee, and also that the incentive fees are fairly allocated between each investor in the fund.

EURIBOR
Stands for Euro Interbank Offered Rate. The rate at which Euro interbank term deposits within the Euro zone are offered by one prime bank to another prime bank.

event-driven investment strategy
An approach that seeks to anticipate specific events, such as mergers or corporate restructurings. Such funds, which include risk-arbitrage vehicles and entities that buy distressed securities, usually employ medium-term holding periods and experience moderate volatility.

ex ante
Latin for "beforehand". In models where there is uncertainty that is resolved during the course of events, the ex ante values (e.g., of expected gain) are those that are calculated in advance of the resolution of uncertainty.

ex post
Latin for "after the fact". In models where there is uncertainty that is resolved during the course of events, the ex post values (e.g., of expected gain) are those that are calculated after the uncertainty has been resolved.