Agreements providing for the future exchange of a particular asset at a currently determined market price.
An exchange-traded obligation to buy or sell a financial instrument or to make a payment at one of the exchange's fixed delivery dates, the details of which are transparent publicly on the trading floor and for which contract settlement takes place through the exchange's clearinghouse. Gamma ( see also Delta) Gamma (or convexity) is the degree of curvature in the financial contract's price curve with respect to its underlying price. It is the rate of change of the delta with respect to changes in the underlying price. Positive gamma is favourable. Negative gamma is damaging in a sufficiently volatile market. The price of having positive gamma (or owning gamma) is time decay. Only instruments with time value have gamma. Hedge A transaction that offsets an exposure to fluctuations in financial prices of some other contract or business risk. It may consist of cash instruments or derivatives.
Essentially a promise to buy or sell a currency (or other type of investment) at a specified price on a particular date. The buyer is required to accept and the seller is required to deliver an investment such as currency or a security on that date at the specified price.
A contract to buy or sell a specified quantity of a particular commodity or instrument at a named date at some point in the future.
a legally binding agreement between a buyer and seller to buy or sell a commodity or financial instrument sometime in the future at a price agreed today
Contracts to buy or sell a certain quantity of an asset or at a fixed price at a specific future date. Contracts trade on an exchange and can be traded before the settlement date. The value of futures derives from the value of underlying assets and are therefore known as derivatives. General Partners The managers of a private equity fund who also have an ownership interest in the fund. See also Limited Partners. Hedge or Hedging A strategy designed to reduce the risk of loss caused by fluctuations in, for example, security prices, interest rates, and foreign currency exchange rates. The basic strategy is to offset the risk exposure of an existing investment.
Are instruments predicated on a cash commodity or currency, a financial instrument, or an index. These are standardized contracts which are traded on organized exchanges. Also, these contracts are subject to industry and exchange regulations and government regulatory bodies and laws. The standardization is one of the key factors which differentiates these instruments from forward contracts. Other factors are the standardization of margin or performance bond procedures and the high degree of anonymous offset. Futures contracts can be offset by a trade opposite to the initial transaction, and EFP, or a good delivery. Good deliveries can be satisfied by either the delivery of the actual commodity or financial instrument or by a final cash payment for Cash Settlement markets.
An agreement to buy or sell a specific amount of a specific commodity or financial instrument at a stipulated price on a particular date in the future.
Limited-time agreements that give the owner of the agreement the right to buy or sell a specified investment in the future for a price that is set through trading on an organized exchange. See also forward contracts.
Based on a contract specification fixed by the exchange and traded in a single commodity. In the case of cotton there is only one significant international cotton exchange, based at New York. The basic unit of trading is 22,700 kilos or 50,000lbs (approximately 100 US statistical bales) of Grade 41 (Strict Low Middling) staple 34 (1-1/16") micronaire 3.5-4.9. Less than 2 percent of contracts are actually delivered. They are used more as a price discovery tool or a hedging mechanism. (See also long, NYCE)
A contract to buy or sell an amount of a commodity for a specific price at a specific point in the future.
A contract to buy or sell specific amounts of a specific commodity (such as grain or foreign currency) for an agreed-upon price at a certain time in the future.
An agreement to buy or sell a specific amount of a commodity or financial instrument at a particular price on a stipulated future date. The contract can be sold before the settlement date.
