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Contango

A pricing structure in securities, foreign currencies and commodities trading wherein the prices of far future deliveries exceed those of...

Flat Rate Forward

A forward contract/ futures contract that has a flat/ constant contango over the course of its lifespan. Contango occurs when...

Hedge Ratio

The ratio of the value of long or short futures contracts to the value of the cash commodity being hedged....

Booking The Basis

A forward pricing sales arrangement which involves determining the cash price of a forward sales agreement (a futures contract) either...

Weather Futures

A weather derivative that is principally used to transfer risk associated with adverse weather events. It is an index-based futures...

Reverse Cash and Carry

A cash and carry transaction that is reversed. It involves the simultaneous sale of a cash market commodity/ instrument for...

Locked Limit Down

On the futures markets, it indicates that the highest current bid on a futures contract is below the maximum price...

CTFF

It stands for cash-to-first futures; a short cash rate that is observed from current day to the maturity date of...

Cash-To-First Futures

A short cash rate that is observed from current day to the maturity date of the first (nearest) futures contracts....

Slippage

With respect to futures, it is the difference between estimated transaction costs and the actual cost paid. Such unexpected costs...