An introducing broker (IB) is a person or firm who solicits or accepts orders to buy or sell futures contracts, options on futures, retail off-exchange foreign currency contracts or swaps but does not accept any money or other assets from customers to support these orders. An IB must register with the Commodity Futures Trading Commission … Read more
The spark spread is the margin between the price of natural gas and the price of electricity. The spread is used as a measure of market conditions and to predict future electricity prices. The spark spread is calculated by subtracting the price of natural gas from the price of electricity. The spread can be positive … Read more
A roll yield is the return on an investment in a futures contract that is rolled over to a new contract with a different delivery date. The roll yield is calculated by subtracting the price of the new contract from the price of the old contract and then dividing by the old contract’s price. For … Read more
The “cost of tender” is the amount of money that a futures exchange charges to allow a trader to enter or exit a position. This fee is typically a small percentage of the total value of the contract being traded. What are tender fees? Tender fees are the fees charged by a commodities exchange for … Read more
Open Outcry Definition: Open outcry is the traditional method of price discovery and execution in the futures markets. It involves the use of hand signals and oral communication between traders on the floor of a futures exchange to buy and sell contracts. What is Sbts in stock market? The S&P 500 is a stock market … Read more
The delivery date is the date on which the underlying commodity is delivered. This is the date that the contract expires and is settled. Why would you buy a futures contract? A futures contract is an agreement to buy or sell an asset at a future date at a price that is agreed upon today. … Read more
Index arbitrage is the simultaneous purchase and sale of a basket of stocks that make up a particular index in order to profit from discrepancies in the index value. Index arbitrageurs seek to profit from the difference in the price of the index and the actual value of the underlying stocks. Index arbitrage is a … Read more
. Contango: What It Is, Why It Happens, and Backwardation Which is better contango or backwardation? There is no right or wrong answer to this question, as it depends on the trader’s individual circumstances and goals. If a trader is looking to buy a commodity and hold it for a long period of time, then … Read more
The long hedge is a futures market trading strategy that involves taking a long position in a futures contract in order to offset the risk of price movements in the underlying asset. The long hedge can be used to protect against both downside and upside price risk. The long hedge is typically used by institutional … Read more
A clearing fee is a charge assessed by a clearinghouse for the services it provides in clearing trades. Clearing fees are assessed on both sides of a trade, and are generally a percentage of the trade value. The clearing fee is used to cover the costs of clearing trades, including the costs of maintaining a … Read more
