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Rollover Lock

An agreement where one party pays the other a fixed spread (a number of basis points) between the nearby, expiring...

Fungibility

The interchangeability which characterizes a futures contract. More precisely, futures contracts for the same commodity and delivery month and which...

ED Futures

It stands for Eurodollar futures; a futures contract on a Eurodollar interest rate such as the 3-month (90-day) Eurodollar interest...

Eurodollar Futures

A futures contract on a Eurodollar interest rate such as the 3-month (90-day) Eurodollar interest rate. In the US markets,...

Margin Valuation Adjustment

It is a type of cross value adjustment/ x-value adjustment (XVA) that constitute the part of cost relating to initial...

Margin

With respect to buying on margin, it is the money put up in a margin account to partially finance the...

Margin Account

Cash and marketable securities an investor deposits with a broker to guarantee that the former will honor or keep up...

Clearing

The processes undertaken by a specialized corporation, called a clearinghouse, in order to facilitate securities transactions. That includes: validation, delivery...

Tailing Adjustment

An adjustment that is made to the number of futures contracts used in hedging a position in order to accommodate...

Symmetric Payoff

A payoff (of a specific derivative instrument) whose value changes continuously and proportionally up or down in response to movements...