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Futures Trading Terms
A B C D E F G H I L M N O P Q R S T U V W Y
selected terms: 173 page 4 of 9

61. 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 More…
62. Exercise Price See also: Strike Price =National Futures Association
63. Expiration Date Generally the last date on which an option may be exercised. It is not uncommon for an option to expire on a specified date during the month prior to the delivery month for the underlying More…
64. Extrinsic Value See also: Time Value =National Futures Association
65. First Notice Day The first day on which notice of intent to deliver a commodity in fulfillment of an expiring futures contract can be given to the clearinghouse by a seller and assigned by the clearing- More…
66. Floor Broker house to a buyer. Varies from contract to contract. An individual who executes orders on the trading floor of an exchange for any other person. =National Futures Association
67. Floor Trader An individual who is a member of an exchange and trades for his own account on the floor of =National Futures Association
68. Forward (Cash) Contract A contract which requires a seller to agree to deliver a specified cash commodity to a buyer sometime in the future. All terms of the contract are customized, in contrast to futures More…
69. Frontrunning A process whereby a futures or options position is taken based on non-public information about an impending transaction in the same or related futures or options contract. =National More…
70. Fully Disclosed An account carried by a Futures Commission Merchant in the name of an individual customer; the opposite of an Omnibus Account. =National Futures Association
71. Fundamental Analysis A method of anticipating future price movement using supply and demand information. =National Futures Association
72. Futures Commission Merchant (FCM) An individual or organization which solicits or accepts orders to buy or sell futures contracts or ommodity options and accepts money or other assets from customers in connection with such More…
73. Futures Contract A legally binding agreement to buy or sell a commodity or financial instrument at a later date. Futures contracts are standardized according to the quality, quantity and delivery time and More…
74. Futures Industry Association (FIA) The national trade association for Futures Commission Merchants. =National Futures Association
75. Grantor A person who sells an option and obligation to sell (in the case of (in the case of a put) the underlying contract at the exercise price. as an Option Seller or Writer. =National More…
76. Guaranteed Introducing Broker A firm or individual that solicits and accepts commodity futures orders from customers but does not accept money, securities or property from the customer. A Guaranteed Introducing Broker More…
77. 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. A long hedge involves buying futures More…
78. High The highest price of the day for a particular futures contract. =National Futures Association
79. Holder The purchaser of either a call or put option. Option buyers receive the right, but not the obligation, to assume a futures position. The opposite of a Grantor. Also referred to as the More…
80. In-the-Money Option An option that has 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 More…

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