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Futures and Forex Glossary Dictionary O2

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An instruction made to a broker to buy or sell an asset in the market.


Technical analysis tool that is used to determine if a currency pair or other asset is overbought or oversold. See Also: Statistical Oscillators

Out Of The Money

When an options strike price (the price at which to exercise) is either higher or lower, depending on call/put type, than the underlying assets price, meaning the option is currently without intrinsic value.

Out Trade

A trade that can't be cleared by a clearinghouse because there are differences in the data provided by the two clearinghouses (representing buyer and seller). Out Trades must be dealt with before the market opens the next day.

Out Of The Money Option

When an option has no intrinsic value, i.e. a call option with a higher strike price than the current market value or a put option with a lower strike price than the market value.

Outward Arbitrage

Banks earning a profit from arbitrage lending by taking advantage of interbank rates abroad.

Over The Counter

A security that is traded outside the normal exchanges such as interest rate swaps between banks and financial institutions.


A technical term referring to situations where the price of an asset has risen to quick and high compared to the underlying fundamental factors. See Also:

Overheated Economy

Economic term describing a situation where prolonged growth in an economy creates inflation and overproduction based on (false) expectations to the future. The 'dot com' and housing bubble are examples of an overheated economy.

Overnight Limit

The maximum of open currency positions that can be carried over from one trading day to the next. Overnight limits are determined by the local central bank.

Overnight Position

A position that is carried over from one trading day to the next.

Overnight Trading

Buying or selling a currency between 9 pm and 8 am local time, when the market is closed. The trader takes a position that will be filled in a foreign market.


When the price of an asset has depreciated faster and stronger than what the fundamentals of the asset suggest to be true. See Also: Undervalued

Over The Counter Market (OTC)

Trades of securities made between banks and other financial institutions that do not take place on an exchange but are carried out internally between the banks, i.e. 'over the counter'.


The legal holder of a security or asset.
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