Pigs, Bricks, and Spiders (or PIIGS, BRIC, & SPDR)
America is not the only country suffering through a financial crisis, and this time around, Greece is making headlines. Due to soaring debt and fear of government default in Greece, the European Union is meeting in Brussels to discuss potential solutions. As you read about Europe’s problems, you are likely to stumble upon the acronym PIIGS. Its use is discouraged in some financial circles, but when an acronym is catchy, it usually sticks.
PIIGS refers to the countries with the most troubled economies, namely Portugal, Italy, Ireland, Greece, and Spain.
The financial sectors loves itself some acronyms, so here’s a couple bonus ones for you.
BRIC is similar to PIIGS in that the acronym describes countries, but this time it refers to emerging countries with a positive economic future. Originally coined by Goldman Sachs, the countries are Brazil, Russia, India, and China. Previously related in acronym only, the four countries have recently held a summit together and are considering some form of economic alliance. 1
SPDRs (pronounced “spiders”) are Standard & Poor’s depositary receipts. Still confused? It’s an investment vehicle known as an exchange traded fund (ETF – yet another acronym) which trades on the stock market like a normal security but reflects an entire index of one’s choosing (depending on which SPDR the investor chooses). In other words, it enables you to invest in the performance of an S&P Index without needing to buy a mutual fund or a collection of stocks.2
Read on:
Telegraph.co.uk – Britain’s quarter of a trillion pound exposure to the PIIGS
DanPink.com – Acronym of the day: PIIGS
Investopedia.com – Spiders – SPDR
- http://en.wikipedia.org/wiki/Bric ↩
- SPDRs are managed solely by State Street Global Advisors, but many other firms offer similar investment vehicles, just with less memorable names. ↩
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