BSE Prices delayed by 5 minutes... << Prices as on Sep 22, 2017 >>  ABB India  1424 [ -1.52% ] ACC  1690.7 [ -3.44% ] Ambuja Cements Ltd.  268.55 [ -2.72% ] Asian Paints Ltd.  1215.15 [ -1.19% ] Axis Bank Ltd.  505.05 [ -1.41% ] Bajaj Auto Ltd.  3039.4 [ -1.26% ] Bank of Baroda  141.75 [ -2.54% ] Bharti Airtel  395.1 [ -1.10% ] Bharat Heavy Ele  129.75 [ -2.52% ] Bharat Petroleum  491.75 [ -0.93% ] Britannia Ind.  4259.8 [ -1.66% ] Cairn India Ltd.  285.4 [ 0.90% ] Cipla  583.8 [ -1.29% ] Coal India Ltd.  253.9 [ 0.12% ] Colgate Palm.  1100.4 [ -1.53% ] Dabur India  304.8 [ -1.80% ] DLF Ltd.  173.5 [ -6.19% ] Dr. Reddy's Labs  2456.65 [ -1.20% ] GAIL (India) Ltd.  397.15 [ -2.37% ] Grasim Inds.  1175.1 [ -2.15% ] HCL Technologies  884.6 [ 1.67% ] HDFC  1782.5 [ -0.35% ] HDFC Bank  1824.55 [ -0.82% ] Hero MotoCorp  3788.15 [ -2.59% ] Hindustan Unilever L  1239.55 [ -1.22% ] Hindalco Indus.  231.3 [ -5.22% ] ICICI Bank  277.1 [ -2.77% ] IDFC L  60.05 [ -2.44% ] Indian Hotels Co  112.15 [ -1.92% ] IndusInd Bank  1707.9 [ -1.22% ] Infosys  898.05 [ -1.26% ] ITC Ltd.  268.25 [ -0.45% ] Jindal St & Pwr  139.35 [ -8.17% ] Kotak Mahindra Bank  1022.65 [ -0.77% ] L&T  1184.9 [ -3.49% ] Lupin Ltd.  1013.55 [ -1.83% ] Mahi. & Mahi  1286.45 [ -0.48% ] Maruti Suzuki India  8074.55 [ -0.71% ] MTNL  20.45 [ 1.49% ] Nestle India  7167.9 [ 0.34% ] NIIT Ltd.  102.15 [ -5.59% ] NMDC Ltd.  122.2 [ -5.01% ] NTPC  166.2 [ -1.13% ] ONGC  164.45 [ -0.93% ] Punj. NationlBak  137.8 [ -2.92% ] Power Grid Corpo  209.75 [ -0.71% ] Reliance Inds.  817.5 [ -2.83% ] SBI  261.9 [ -2.46% ] Vedanta  308.1 [ -4.49% ] Shipping Corpn.  87.4 [ -2.78% ] Sun Pharma.  513.3 [ -1.20% ] Tata Chemicals  615.05 [ -3.85% ] Tata Global Beverage  201.4 [ -5.09% ] Tata Motors Ltd.  411.2 [ -0.51% ] Tata Steel  654.55 [ -4.70% ] Tata Power Co.  80.5 [ -3.25% ] Tata Consultancy  2502.35 [ -0.93% ] Tech Mahindra Ltd.  458.45 [ -0.39% ] UltraTech Cement  3994.2 [ -4.18% ] United Spirits  2464.9 [ -3.92% ] Wipro Ltd  294.05 [ 1.00% ] Zee Entertainment En  521.8 [ -2.58% ] ABB India  1424 [ -1.52% ] ACC  1690.7 [ -3.44% ] Ambuja Cements Ltd.  268.55 [ -2.72% ] Asian Paints Ltd.  1215.15 [ -1.19% ] Axis Bank Ltd.  505.05 [ -1.41% ] Bajaj Auto Ltd.  3039.4 [ -1.26% ] Bank of Baroda  141.75 [ -2.54% ] Bharti Airtel  395.1 [ -1.10% ] Bharat Heavy Ele  129.75 [ -2.52% ] Bharat Petroleum  491.75 [ -0.93% ] Britannia Ind.  4259.8 [ -1.66% ] Cairn India Ltd.  285.4 [ 0.90% ] Cipla  583.8 [ -1.29% ] Coal India Ltd.  253.9 [ 0.12% ] Colgate Palm.  1100.4 [ -1.53% ] Dabur India  304.8 [ -1.80% ] DLF Ltd.  173.5 [ -6.19% ] Dr. Reddy's Labs  2456.65 [ -1.20% ] GAIL (India) Ltd.  397.15 [ -2.37% ] Grasim Inds.  1175.1 [ -2.15% ] HCL Technologies  884.6 [ 1.67% ] HDFC  1782.5 [ -0.35% ] HDFC Bank  1824.55 [ -0.82% ] Hero MotoCorp  3788.15 [ -2.59% ] Hindustan Unilever L  1239.55 [ -1.22% ] Hindalco Indus.  231.3 [ -5.22% ] ICICI Bank  277.1 [ -2.77% ] IDFC L  60.05 [ -2.44% ] Indian Hotels Co  112.15 [ -1.92% ] IndusInd Bank  1707.9 [ -1.22% ] Infosys  898.05 [ -1.26% ] ITC Ltd.  268.25 [ -0.45% ] Jindal St & Pwr  139.35 [ -8.17% ] Kotak Mahindra Bank  1022.65 [ -0.77% ] L&T  1184.9 [ -3.49% ] Lupin Ltd.  1013.55 [ -1.83% ] Mahi. & Mahi  1286.45 [ -0.48% ] Maruti Suzuki India  8074.55 [ -0.71% ] MTNL  20.45 [ 1.49% ] Nestle India  7167.9 [ 0.34% ] NIIT Ltd.  102.15 [ -5.59% ] NMDC Ltd.  122.2 [ -5.01% ] NTPC  166.2 [ -1.13% ] ONGC  164.45 [ -0.93% ] Punj. NationlBak  137.8 [ -2.92% ] Power Grid Corpo  209.75 [ -0.71% ] Reliance Inds.  817.5 [ -2.83% ] SBI  261.9 [ -2.46% ] Vedanta  308.1 [ -4.49% ] Shipping Corpn.  87.4 [ -2.78% ] Sun Pharma.  513.3 [ -1.20% ] Tata Chemicals  615.05 [ -3.85% ] Tata Global Beverage  201.4 [ -5.09% ] Tata Motors Ltd.  411.2 [ -0.51% ] Tata Steel  654.55 [ -4.70% ] Tata Power Co.  80.5 [ -3.25% ] Tata Consultancy  2502.35 [ -0.93% ] Tech Mahindra Ltd.  458.45 [ -0.39% ] UltraTech Cement  3994.2 [ -4.18% ] United Spirits  2464.9 [ -3.92% ] Wipro Ltd  294.05 [ 1.00% ] Zee Entertainment En  521.8 [ -2.58% ] 
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MCX Future Prices delayed by 20 minutes... Aluminium  138.95 [0.43% ]  Aluminium Mini BHIW  138.95 [0.43% ]  Cardamom VAND  1183.3 [1.37% ]  Castor Seeds  4625 [0.00% ]  Copper  423.55 [0.18% ]  Copper Mini MUM  423.6 [0.21% ]  Cotton(29mm) RJKT  18470 [0.70% ]  Crude Oil  3287 [-0.24% ]  Crude Oil Mini MUM  3287 [-0.24% ]  CrudePalmOil  544.9 [0.94% ]  Gold  29585 [0.07% ]  Gold Guinea AHM  23771 [0.30% ]  Gold M  29608 [0.08% ]  Gold Petal MUM  2935 [-0.03% ]  Lead Mini MUM  161.7 [0.99% ]  Lead MUM  161.65 [0.93% ]  Mentha Oil  1175.1 [0.25% ]  Natural Gas HZR  192.6 [0.20% ]  Nickel  686.9 [-1.08% ]  Nickel Mini MUM  686.8 [-1.08% ]  Pepper  44230 [0.53% ]  RBD Palmolein  579 [0.00% ]  Silver  39727 [-0.26% ]  Silver 1000 DEL  39466 [-0.21% ]  Silver M  39735 [-0.30% ]  Silver Micro AHM  39736 [-0.29% ]  Zinc Mini BHIW  201.05 [1.48% ]  Zinc Mum  201 [1.46% ]  
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SEMINARS & EVENTS
Learning is a way of life, paving the way for the future

SKUNG endeavours to sustain long-term relationships with our clients by proactively improving and customizing our education seminars to meet your changing needs. We cater to customers with different levels of experience, knowledge and interests.
Our wide range of seminars covers Introduction to Futures & CURRENCY Trading, Technical & Fundamental analysis and market overview & trends, presented by our many experienced consultants in the form of interactive sharing sessions and informative Questions & answers session

ONE TO ONE COACHING
Interested in Futures trading but always find that you lack sufficient knowledge? Join us for a free personalized one-to-one coaching session which you can arrange at a timing of your convenience.

Objectives
The one-to-one coaching session mainly caters to individuals who are interested in trading but do not have any knowledge of these products or the related markets. The session aims to equip beginners with the basics of derivatives trading and answer all the questions you may have related to products or platforms. The coaching is absolutely Free!

Our Tutors
Our group of experienced in-house dealers are familiar with the wide range of Futures, . We will also provide comprehensive trading platforms demo and guidance on how to effectively use the features on our electronic trading platforms to trade in the derivatives markets, by sharing essential information and resources related to Futures trading and proper risk management.
For registration, please write a mail to us (with a preferred time slot) at helpdesk@skunggroup.com


Glossary

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Actuals - An actual physical commodity which is delivered at the completion of a contract, as opposed to a futures contract on that commodity. A futures contract will specify the number of units of the cash commodity that must be delivered, and also the specific features of the cash commodity. also called cash commodity.
Add-on Method -A method of paying interest where the interest is added onto the principal at maturity or interest payment dates.
Adjusted Futures Price - The cash-price equivalent reflected in the current futures price..
Against Actuals - A transaction generally used by two hedgers who want to exchange futures for cash positions. Also referred to as " Exchange for Physicals” or "versus cash".
American Style Option -Type of option contract that can be exercised at the buyer's discretion on any trading day up to and including the expiration date. This differs from a European style option, which may only be exercised on its expiration date.
Arbitrage - The simultaneous purchase of cash, futures, or options in one market against the sale of cash, futures or options in a different market in order to generate profit from a price disparity. Ask - Also called "offer" Indicates a willingness to sell a futures or options on futures contract at a given price.
Bar Chart -A chart that graphs the high, low, and settlement prices for a specific trading session over a given period of time.
Basis - The difference between the current cash price and the futures price of the same commodity. Unless otherwise specified, the price of the nearby futures contract month is generally used to calculate the basis.
Bear - Someone who thinks market prices will decline.
Bear Market - A period of declining market prices.
Bear Spread - In most commodities and financial instruments, the term refers to selling the nearby contract month, and buying the deferred contract, to profit from a change in the price relationship.
Bid - An expression indicating a desire to buy a commodity at a given price, opposite of offer.
Bond - Instrument traded on the cash market representing a debt of the government or of a company. Brokerage Fee - A fee charged by a broker for executing a transaction.
Bull - Someone who thinks market prices will rise.
Bull Market - A period of rising market prices.
Bull Spread - In most commodities and financial instruments, the term refers to buying the nearby month, and selling the deferred month, to profit from the change in the price relationship.
Butterfly Spread - The placing of two inter-delivery spreads in opposite directions with the centre delivery month common to both spreads.
Buying Hedge - Buyer futures contracts to protect against a possible price increase of cash commodities that will be purchased in the future. At the time the cash commodities are bought, the open futures position is closed by selling an equal number and type of futures contracts as those that were initially purchased.
Buy on close - To buy at the end of a trading session at a price within the closing range.
Buy on opening - To buy at the beginning of a trading session at a price within the opening range.
Calendar Spread - The purchase of one delivery month of a given futures contract and simultaneous sale of another delivery month of the same commodity on the same exchange. The purchase of either a call or put option and the simultaneous sale of the same type of option with typically the same strike price but with a different expiration month.
Call - An option to buy a commodity, security or futures contract at a specified price any time between now and the expiration date of the option contract.
Call Option - An option that gives the buyer the right, but not the obligation, to purchase (go "long") the underlying futures contract at the strike price on or before the expiration date.
Cancelling Order - An order that deletes a customer's previous order.
Carrying Charge -For physical commodities such as grains and metals, the cost of storage space, insurance, and finance charges incurred by holding a physical commodity. In interest rate futures markets, it refers to the differential between the yield on a cash instrument and the cost of funds necessary to buy the instrument. Also referred to as cost of carry..
Cash Commodity - An actual physical commodity someone is buying or selling, e.g., soybeans, gold, silver, Treasury bonds, etc. Also referred to as actual.
Cash Contract - A sales agreement for either immediate or future delivery of the actual product.
Cash Market - A place where people buy and sell the actual commodities, i.e., grain elevator, bank, etc. Spot usually refers to a cash market price for a physical commodity that is available for immediate delivery. A forward contract is a cash contract in which a seller agrees to deliver a specific cash commodity to a buyer sometime in the future. Forward contracts, in contrast to futures contracts, are privately negotiated and are not standardized.
Charting - The use of charts to analyze market behaviour and anticipate future price movements. Those who use charting as a trading method plot such factors as high, low, and settlement prices; average price movements; volume; and open interest. Two basic price charts are bar charts and point-and-figure charts. Anticipating future price movement using historical prices, trading volume, open interest and other trading data to study price patterns.
Clear - The process by which a clearing-house maintains records of all trades and settles margin flow on a daily mark-to-market basis for its clearing member.
Clearing Member - A member of an exchange clearing-house. Memberships in clearing organizations are usually held by companies. Clearing members are responsible for the financial commitments of customers that clear through their firm.
Clearinghouse - An agency or separate corporation of a futures exchange that is responsible for settling trading accounts, clearing trades, collecting and maintaining margin money, regulating delivery, and reporting trading data. Clearinghouses act as third parties to all futures and options contracts, acting as a buyer to every clearing member seller and a seller to every clearing member buyer.
Closing Price - The last price paid for a commodity on any trading day. The exchange clearinghouse determines a firm's net gains or losses, margin requirements, and the next day's price limits, based on each futures and options contract settlement price. If there is a closing range of prices, the settlement price is determined by averaging those prices. Also referred to as settle price.
Closing Range - A range of prices at which buy and sell transactions took place during the market close.
Commission - For futures contracts, the one-time fee charged by a broker to cover the trades a client makes to open and close each position. It is payable when the client exits the position. Commissions on options are usually half on initiation and paid half on liquidation.
Commission Fee - A fee charged by a broker for executing a transaction. Also referred to as brokerage fee.
Commodity - An article of commerce or a product that can be used for commerce. In a narrow sense, products traded on an authorized commodity exchange. The types of commodities include agricultural products, metals, petroleum, foreign currencies, and financial instruments and index, to name a few.
Contract Month - A specific month in which delivery may take place under the terms of a futures contract.
Cross-Hedging - Hedging a cash commodity using a different but related futures contract when there is no futures contract for the cash commodity being hedged and the cash and futures markets follow similar price trends (e.g., using soybean meal futures to hedge fish meal).
Current Yield - The ratio of the coupon to the current market price of the debt instrument.
Currency risk - The potential for a shift in exchange rates, which would be detrimental to a trader's position.
Customer Margin - Within the futures industry, financial guarantees required of both buyers and sellers of futures contracts and sellers of options contracts to ensure fulfilling of contract obligations. TCMs are responsible for overseeing customer margin accounts. Margins are determined on the basis of market risk and contract value. Financial safeguards to ensure that clearing members (usually companies or corporations) perform on their customers' open futures and options contracts.
Daily Trading Limit - The maximum price range set by the exchange cash day for a contract. Day Traders - Speculators who take positions in futures or options contracts and liquidate them prior to the close of the same trading day.
Deferred (Delivery) Month - The more distant month(s) in which futures trading is taking place, as distinguished from the nearby (delivery) month.
Deficit - A situation in which a country has a negative balance of trade or payments.
Delivery - The transfer of the cash commodity from the seller of a futures contract to the buyer of a futures contract. Each futures exchange has specific procedures for delivery of a cash commodity. Some futures contracts, such as stock index contracts, are cash settled.
Delivery Month - A specific month in which delivery may take place under the terms of a futures contract. Also referred to as contract month.
Delivery Points - The locations and facilities designated by a futures exchange where stocks of a commodity may be delivered in fulfilment of a futures contract, under procedures established by the exchange.
Equilibrium Price - The market price at which the quantity supplied of a commodity equals the quantity demanded.
Exercise - The action taken by the holder of a call option if he wishes to purchase the underlying futures contract or by the holder of a put option if he wishes to sell the underlying futures contract. Exercise Price - The price at which the futures contract underlying a call or put option can be purchased (if a call) or sold (if a put). Also referred to as strike price.
Expiration Date - Options on futures generally expire on a specific date during the month preceding the futures contract delivery month. For example, an option on a March futures contract expires in February but is referred to as a March option because its exercise would result in a March futures contract position.
Extrinsic Value - The amount of money option buyer are willing to pay for an option in the anticipation that, over time, a change in the underlying futures price will cause the option to increase in value. In general, an option premium is the sum of time value and intrinsic value. Any amount by which an option premium exceeds the option's intrinsic value can be considered time value. Also referred to as time value.
Foreign Exchange Market - An over-the-counter market, where buyers and sellers conduct foreign exchange business by telephone and other means of communication. Also referred to as a FOREX market.
FOREX Market - An over-the-counter market where buyers and sellers conduct foreign exchange business by telephone and other means of communication. Also referred to as foreign exchange market.
Forward (Cash) Contract - A cash contract in which a seller agrees to deliver a specific cash commodity to a buyer sometime in the future. Forward contracts, in contrast to futures contracts, are privately negotiated and are not standardized.
Fundamental Analysis - A method of anticipating future price movement using supply and demand information.
Futures Contract - A legally binding agreement, made on the trading floor of a futures exchange, to buy or sell a commodity or financial instrument sometime in the future. Futures contracts are standardized according to the quality, quantity, and delivery time and location for each commodity. The only variable is price, which is discovered on an exchange trading floor.
Futures Exchange - A central marketplace with established rules and regulations where buyers and sellers meet to trade futures and options on futures contracts.
Gross Domestic Product - The value of all final goods and services produced by an economy over a particular time period, normally a year.
Gross National Product - Gross Domestic Product plus the income accruing to domestic residents as a result of investments abroad less income earned in domestic markets accruing to foreigners abroad.
Good-till-cancelled (GTC) order - Also known as open order. An order that remains in effect until it is cancelled filled or the contract expires.
Hedging - The practice of offsetting the price risk inherent in any cash market position by taking an equal but opposite position in the futures market. Hedgers use the futures markets to protect their business from adverse price changes. Selling (Short) Hedge - Selling futures contracts to protect against possible declining prices of commodities that will be sold in the future. At the time the cash commodities are sold, the open futures position is closed by purchasing an equal number and type of futures contracts as those that were initially sold. and Purchasing (Long) Hedge - Buyer futures contracts to protect against a possible price increase of cash commodities that will e purchased in the future. At the time the cash commodities are bought, the open futures position is closed by selling an equal number and type of futures contracts as those that were initially purchased.
High - The highest price of the day for a particular futures contract.
Holder - The purchaser of either a call or put option. Option buyers receive the right, but not the obligation, to assume a futures position.
Horizontal Spread - The purchase of either a call or put option and the simultaneous sale of the same type of option with typically the same strike price but with a different expiration month also referred to as a calendar spread.
In-the-Money Option - An option having intrinsic value. A call option is in-the-money if its strike price is below the current price of the underlying futures contract. A put option is in-the-money if its strike price is above the current price of the underlying futures contract. The amount by which an option is in-the-money.
Initial Margin - The amount a futures market participant must deposit into his margin account at the time he places an order to buy or sell a futures contract. Also referred to as original margin.
Inter-commodity Spread - The purchase of a given delivery month of one futures market and the simultaneous sale of the same delivery month of a different, but related, futures market.
Inter-delivery Spread - The purchase of one delivery month of a given futures contract and simultaneous sale of another delivery month of the same commodity on the same exchange. Also referred to as an intra-market or calendar spread.
Inter-market Spread -The sale of a given delivery month of a futures contract on one exchange and the simultaneous purchase of the same delivery month and futures contract on another exchange.
Intrinsic Value - The amount by which an option is in-the-money. An option having intrinsic value. A call option is in-the-money if its strike price is below the current price of the underlying futures contract. A put option is in-the-money if its strike price is above the current price of the underlying futures contract.
Joint Account - An agreement between two or more firms to share risk and financing responsibility in purchasing or underwriting securities.
K
Last Trading Day - The final day when trading may occur in a given futures or option contract month. Futures contracts outstanding at the end of the last trading day must be settled by delivery of the underlying commodity or securities or by agreement for monetary settlement.
Leverage - The ability to control large dollar amounts of a commodity with a comparatively small amount of capital.
Limit Order - An order in which the customer sets a limit on the price and/or time of execution.
Limits - The maximum number of speculative futures contracts one can hold as determined by the Commodity Futures Trading Commission and/or the exchange upon which the contract is traded. Also referred to as trading limit. The maximum advance or decline from the previous day's settlement permitted for a contract in one trading session by the rules of the exchange.
Liquidate - Selling (or purchasing) futures contracts of the same delivery month purchased (or sold) during an earlier transaction or making (or taking) delivery of the cash commodity represented by the futures contract. Taking a second futures or options position opposite to the initial or opening position.
Long - One who has bought futures contracts or owns a cash commodity.
Long position - A market position in which the trader has bought a futures contract or options on futures contract that does not offset a previously established short position.
Long Hedge - Buyer futures contracts to protect against a possible price increase of cash commodities that will e purchased in the future. At the time the cash commodities are bought, the open futures position is closed by selling an equal number and type of futures contracts as those that were initially purchased.
Low - The lowest price of the day for a particular futures contract.
Maintenance - A set minimum margin (per outstanding futures contract) that a customer must maintain in his margin account.
Margin - Financial safeguards to ensure that clearing members (usually companies or corporations) perform on their customers' open futures and options contracts. Clearing margins are distinct from customer margins that individual buyers and sellers of futures and options contracts are required to deposit with brokers. Within the futures industry, financial guarantees required of both buyers and sellers of futures contracts and sellers of options contracts to ensure fulfilling of contract obligations.
Margin Call - A call from a clearinghouse to a clearing member, or from a brokerage firm to a customer, to bring margin deposits up to a required minimum level.
Market-if-touched (MIT) - An order that automatically becomes a market order if the price is reached. An MIT order to buy becomes a limit order if and when the instrument trades at a specific or lower trigger price; an MIT order to sell becomes a limit order if and when the instrument trades at a specified or higher trigger price.
Market Order - An order to buy or sell a futures contract of a given delivery month to be filled at the best possible price and as soon as possible.
Marking-to-Market - To debit or credit on a daily basis a margin account based on the close of that day's trading session. In this way, buyers and sellers are protected against the possibility of contract default.
Maximum price fluctuation - The maximum amount the contract price can change up or down during one trading session, as stipulated by exchange rules.
Minimum Price Fluctuation - The smallest allowable increment of price movement for a contract.
Moving-Average Charts - A statistical price analysis method of recognizing different price trends. A moving average is calculated by adding the prices for a predetermined number of days and then dividing by the number of days.
N
Offer - An expression indicating one's desire to sell a commodity at a given price; opposite of bid.
Offset - Taking a second futures or options position opposite to the initial or opening position. Selling (or purchasing) futures contracts of the same delivery month purchased (or sold) during an earlier transaction or making (or taking) delivery of the cash commodity represented by the futures contract.
Open Interest - The total number of futures or options contracts of a given commodity that have not yet been offset by an opposite futures or option transaction nor fulfilled by delivery of the commodity or option exercise. Each open transaction has a buyer and a seller, but for calculation of open interest, only one side of the contract is counted.
Open position - A long or short position that has not been liquidated.
Opening Range - A range of prices at which buy and sell transactions took place during the opening of the market.
Option - A contract that conveys the right, but not the obligation, to buy or sell a particular item at a certain price for a limited time. Only the seller of the option is obligated to perform.
Option Buyer - The purchaser of either a call or put option. Option buyers receive the right, but not the obligation, to assume a futures position.
Option Premium - The price of an option the sum of money that the option buyer pays and the option seller receives for the rights granted by the option.
Option Seller - The person who sells an option in return for a premium and is obligated to perform when the holder exercises his right under the option contract. Also referred to as the writer.
Option Spread - The simultaneous purchase and sale of one or more options contracts, futures, and/or cash positions.
Option Writer - The person who sells an option in return for a premium and is obligated to perform when the holder exercises his right under the option contract. Also referred to as the Option Seller.
OCO (order-cancels-other) - A type of order that includes two orders, one of which cancels the other when filled.
Original Margin - The amount a futures market participant must deposit into his margin account at the time he places an order to buy or sell a futures contract. Also referred to as initial margin.
Out-of-the-Money Option - An option with no intrinsic value, i.e., a call whose strike price is above the current futures price or a put whose strike price is below the current futures price.
Over-the-Counter Market - A market where products such as stocks, foreign currencies, and other cash items are bought and sold by telephone and other means of communications.
Point-and-Figure Charts - Charts that show price changes of a minimum amount regardless of the time period involved.
Position - A market commitment. A buyer of a futures contract is said to have a long position and, conversely, a seller of futures contracts is said to have a short position.
Position Limit - The maximum number of speculative futures contracts one can hold as determined by the Commodity Futures Trading Commission and/or the exchange upon which the contract is traded. Also referred to as trading limit.
Position Trader - An approach to trading in which the trader either buys or sells contracts and holds them for an extended period of time.
Price Limit Order -A customer order that specifies the price at which a trade can be executed.
Producer Price Index (PPI) - An index that shows the cost of resources needed to produce manufactured goods during the previous month.
Profit and loss Statement - A Statement sent by a commission house to a customer when his futures or options on futures position ha changed, showing the number of contracts bought or sold, the prices at which the contracts were bought or sold, the gross profit or loss, the commission charges, and the net profit or loss on the transaction.
Purchasing Hedge or Long Hedge - Buyer futures contracts to protect against a possible price increase of cash commodities that will e purchased in the future. At the time the cash commodities are bought, the open futures position is closed by selling an equal number and type of futures contracts as those that were initially purchased. Also referred to as a buying hedge. The practice of offsetting the price risk inherent in any cash market position by taking an equal but opposite position in the futures market. Hedgers use the futures markets to protect their business from adverse price changes.
Put Option - An option that gives the option buyer the right but not the obligation to sell (go "short") the underlying futures contract at the strike price on or before the expiration date.
Put value - At expiration, equal to the strike price minus the futures price.
Quantity - Number of units or lots of a futures contract.
Reverse Crush Spread - The sale of soybean futures and the simultaneous purchase of soybean oil and meal futures
Scalper - A trader who trades for small, short-term profits during the course of a trading session, rarely carrying a position overnight.
Selling Hedge or Short Hedge - Selling futures contracts to protect against possible declining prices of commodities that will be sold in the future. At the time the cash commodities are sold, the open futures position is closed by purchasing an equal number and type of futures contracts as those that were initially sold. The practice of offsetting the price risk inherent in any cash market position by taking an equal but opposite position in the futures market. Hedgers use the futures markets to protect their business from adverse price changes.
Short (noun) - One who has sold futures contracts or plans to purchase a cash commodity. (verb) Selling futures contracts or initiating a cash forward contract sale without offsetting a particular market position.
Short Hedge - Selling futures contracts to protect against possible declining prices of commodities that will be sold in the future. At the time the cash commodities are sold, the open futures position is closed by purchasing an equal number and type of futures contracts as those that were initially sold.
Speculator - A market participant who tries to profit from buying and selling futures and options contracts by anticipating future price movements. Speculators assume market price risk and add liquidity and capital to the futures markets.
Spot - Usually refers to a cash market price for a physical commodity that is available for immediate delivery.
Spot Month - The futures contract month closest to expiration. Also referred to as nearby delivery month.
Spread - The price difference between two related markets or commodities.
Spreading - The simultaneous buying and selling of two related markets in the expectation that a profit will be made when the position is offset. Examples include: buying one futures contract and selling another futures contract of the same commodity but different delivery month; buying and selling the same delivery month of the same commodity on different futures exchanges; buying a given delivery month of one futures market and selling the same delivery month of a different, but related, futures market.
Stop Order - An order to buy or sell when the market reaches a specified point. A stop order to buy becomes a market order when the futures contract trades (or is bid) at or above the stop price. A stop order to sell becomes a market order when the futures contract trades (or is offered) at or below the stop price.
Stop-Limit Order - A variation of a stop order in which a trade must be executed at the exact price or better. If the order cannot be executed, it is held until the stated price or better is reached again.
Strike Price - The price at which the futures contract underlying a call or put option can be purchased (if a call) or sold (if a put). Also referred to as exercise price.
Technical Analysis - Anticipating future price movement using historical prices, trading volume, open interest and other trading data to study price patterns.
Tick - The smallest allowable increment of price movement for a contract. Time Limit Order - A customer order that designates the time during which it can be executed.
Time Value - The amount of money option buyer are willing to pay for an option in the anticipation that, over time, a change in the underlying futures price will cause the option to increase in value. In general, an option premium is the sum of time value and intrinsic value. Any amount by which an option premium exceeds the option's intrinsic value can be considered time value.
Trading day - Period within which all executed trades for a given class are cleared on the same day. Hours of trading as determined by the Board for each contract starting with the opening of trading and ending with the close of trading for such contract; this period may very well exceed 24 hours. One or more sessions could take place. Often referred to as clearing day.
Trading Limit - The maximum number of speculative futures contracts one can hold as determined by the Commodity Futures Trading Commission and/or the exchange upon which the contract is traded. Also referred to as position limit.
Treasury Bill - A Treasury bill is a short-term U.S. government obligation with an original maturity of one year or less. Unlike a bond or note, a bill does not pay a semi-annual, fixed rate coupon. A bill is typically issued at a price below its par value and is therefore a discounted instrument. The level of the discount depends on the level of prevailing interest rates. In general, the higher short-term interest rates are, the greater the discount. The return to an investor in bills is simply the difference between the issue price and par value.
Treasury Bond - Government-debt security with a coupon and original maturity of more than 10 years. Interest is paid semiannually.
Treasury Note - Government-debt security with a coupon and original maturity of one to 10 years.
Underlying Futures Contract - The specific futures contract that is bought or sold by exercising an option
Variation Margin - During periods of great market volatility or in the case of high-risk accounts, additional margin deposited by a clearing member firm to an exchange.
Vertical Spread - Buying and selling puts or calls of the same expiration month but different strike prices.
Volatility - A measurement of the change in price over a given period. It is often expressed as a percentage and computed as the annualized standard deviation of the percentage change in daily price.
Volume - The number of purchases or sales of a commodity futures contract made during a specific period of time, often the total transactions for one trading day.
Writer -The person who sells an option in return for a premium and is obligated to perform when the holder exercises his right under the option contract. Also referred to as the option seller.
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Yield - A measure of the annual return on an investment.
Yield Curve - A chart in which the yield level is plot on the vertical axis and the term to maturity of debt instruments of similar creditworthiness is plotted n the horizontal axis. The yield curve is positive when long-term rates are higher than short-term rates; however, the yield curve is negative, or inverted, when long term rates are lower than short term rates.
Yield to Maturity - The rate of return an investor receives if a fixed-income security is held to maturity
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