A designated exchange for trading a specific option or futures contract. Example: The S&P 500 Index options and futures contracts are designated to be traded in the contract market Chicago Mercantile Exchange. Related Terms: Designated Exchange, Derivatives Transaction Execution Facility
A particular month in which a futures contract may be complied with by either making or accepting a delivery.
The progression of the price of a futures contract tending to go near the price of the underlying cash commodity. Prices are lower at the start and as it nears expiry date, the futures price and cash price converge.
The exchange rate at which one currency can be swapped for another currency.
Any currency which can be exchanged for another currency devoid of seeking clearance from hawkish government controls.
The relationship between two variables in the domain of stocks, options and futures.
The representative of a foreign bank who is empowered to arrange transfer of funds etc, on behalf of the principal
Costs involved as a consequence of an ongoing investment position. Examples: Interests on loans, bonds, and opportunity costs. Related Terms: Economic Value Added (EVA)
The person taking part in a financial transaction.
The other party in a forex trade, as for example the market maker which is the other party in on-line spot forex. Related Terms: Market maker
The stability of a particular currency vis a vis the level of economic and political uncertainty attributed to its country of origin.
A forex deal purchased to offset a short position taken earlier.
An options contract initiated by the owner of the share underlying the option. Example: If the owner of 1000 shares of ABC Company writes or sells 5 ABC call options; it would be deemed that the seller has a covered option position.
Allowing a currency with a fixed exchange rate to fluctuate within a spectrum of rates as an alternative to drastic and sudden devaluation of a currency. Example: Putting in place of the crawling peg exchange system of the Mexican pesos in the mid-1980’s. Related Terms: Currency, Exchange Rat
Trading of currencies in forex not including US dollars, or trading one currency for another without first having to exchange it into the US dollar. Related Terms: Cross Rate, Base Currency
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