Finance

Month: December 2016

  • Trading Ahead

    ResourcesSee AlsoFront Running Futures Trading Consumer Protection Consumer Finance

  • Markit Boat

    Concept of Markit Boat in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A MiFID-compliant trade reporting platform which enables investment firms to meet their pre-trade quoting and post-trade reporting obligations for all their European OTC […]

  • Long Form

    Concept of Long Form in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A confirmation that is independent of any master agreement incorporated by reference. Since the inception of Master Confirmation Agreements (MCAs), this term has also been […]

  • Back Months

    Concept of Back Months in Futures TradingIn this context of financial law, the following is a definition of Back Months: Futures delivery months other than the spot or front month (also called deferred months ).

  • Par Value

    Concept of Par Value in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): The principal amount of a bond. Also known as the face value.ResourcesSee AlsoDerivatives Contract

  • Closing-Out

    Concept of Closing-Out in Futures TradingIn this context of financial law, the following is a definition of Closing-Out: Liquidating an existing long or short futures or option position with an equal and opposite transaction. Also known as Offset.

  • Offset

    Concept of Offset in Futures TradingIn this context of financial law, the following is a definition of Offset: Liquidating a purchase of futures contracts through the sale of an equal number of contracts of the same delivery month, or liquidating a short sale of futures through the purchase of […]

  • Portfolio Margining

    Concept of Portfolio Margining in Futures TradingIn this context of financial law, the following is a definition of Portfolio Margining: A method for setting margin requirements that evaluates positions as a group or portfolio and takes into account the potential for losses on some positions to […]

  • Random Walk

    Concept of Random Walk in Futures TradingIn this context of financial law, the following is a definition of Random Walk: An economic theory that market price movements move randomly. This assumes an efficient market. The theory also assumes that new information comes to the market randomly. […]

  • Liquidation

    Concept of Liquidation in Futures TradingIn this context of financial law, the following is a definition of Liquidation: The closing out of a long position. The term is sometimes used to denote closing out a short position, but this is more often referred to as covering. See Cover, Offset.

  • Compounding

    Concept of Compounding in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): The process by which the value of an investment increases by adding the accumulated interest back on the principal amount. In effect, the investment is earning interest […]

  • Negative Carry

    Concept of Negative Carry in Futures TradingIn this context of financial law, the following is a definition of Negative Carry: The cost of financing a financial instrument (the short-term rate of interest), when the cost is above the current return of the financial instrument. See Carrying […]

  • Money Market

    Concept of Money Market in Futures TradingIn this context of financial law, the following is a definition of Money Market: The market for short-term debt instruments.

  • Agricultural Trade Option

    Concept of Agricultural Trade Option in Futures TradingIn this context of financial law, the following is a definition of Agricultural Trade Option: Off-exchange options on agricultural commodities that are transacted directly between commercial market participants for hedging or risk […]

  • Assignable Contract

    Concept of Assignable Contract in Futures TradingIn this context of financial law, the following is a definition of Assignable Contract: A contract that allows the holder to convey his rights to a third party. Exchange-traded contracts are not assignable.