Hedge
To hedge is to take a futures position that is equal and opposite to a position held in the cash market. The objective is to mitigate the risk of an adverse move in prices....
Tagged: Futures
Credit derivative
Overview of Credit Derivatives A credit asset is the extension of credit in some form: normally a loan, accounts receivable, installment credit or financial lease contract. Every credit asset is a bundle of risks...
Swaps
Swap, in finance, refers to a derivative product in which the parties to the contract agree to exchange cash flows of each other’s financial instruments. The benefits arising out of a swap contract depend...
Clearing house
According to 15 USCS § 78c (23) (A) the term ‘‘clearing agency’’ means any person who acts as an intermediary in making payments or deliveries or both in connection with transactions in securities or...
Commodity market
Trading of commodities consists of direct physical trading and derivatives trading. Commodities include a range of diverse products. More recently there has been growing sophistication of commodities investments with the introduction of new “exotic”...
Forwards
A forward contract is a contractual agreement between two parties to buy or sell an asset at a price agreed upon today for delivery at a specified future date. It is different from a...
NYSE Euronext
NYSE Euronext Inc. is a New York-City-based Euro-American multinational financial services company operating a number of securities exchanges, including the world’s largest stock exchange, the New York Stock Exchange. Back in March 2006, NYSE...
Hong Kong Stock Exchange (HKG)
Hong Kong Exchanges and Clearing Limited, or HKEx, operates a securities market and a derivatives market in Hong Kong and the clearing houses for those markets. HKEx was listed in Hong Kong in 2000...
Derivatives Market
The derivatives market is the market for financial instruments derived from another asset. Futures and options contracts are one example of derivatives. A derivatives market may be exchange regulated or over-the-counter. Not only is...
Commodity Futures Trading Commission (CFTC)
Congress created the Commodity Futures Trading Commission (CFTC) in 1974 as an independent agency with the mandate to regulate commodity futures and option markets in the United States. The agency’s mandate has been renewed...
Minneapolis Grain Exchange
The Minneapolis Grain Exchange, MGEX for short, is the principal market for trade in futures and options contracts for hard red spring wheat (HRSW) that is grown primarily in the northern plains of USA...
New York Mercantile Exchange (NYMEX)
The New York Mercantile Exchange (NYMEX) offers derivative products in commodities. It is part of the CME Group of Chicago, which also owns and operates the Chicago Mercantile Exchange, the Chicago Board of Trade...
Montreal Exchange
The Montreal Exchange (Bourse de Montréal) or simply MX is a futures and options (derivatives) exchange located in the Canadian city of Montreal. Along with equities, it offers derivative products in currencies, indices, Exchange...
Chicago Mercantile Exchange (CME)
The Chicago Mercantile Exchange (CME), a financial and commodity futures and options exchange located at 20 S. Wacker Drive, Chicago, was established in 1898 as an agricultural commodities exchange as Chicago Butter and Egg...
London Metal Exchange (LME)
The London Metal Exchange (LME) is a premier futures exchange, actually the largest market for futures and options contracts in base metals. The LME offers cash trading and futures and options contracts with expiry...