Negative Carry

• In accounting, the break-even point is calculated by dividing the fixed costs of production by the unit price minus the variable costs of production.

• The break-even price describes the change in value that only corresponds to covering the initial investment or cost.

• Preliminary analysis in financial markets refers to the forecasting of various indicators, economic and financial, by evaluating past and present data and parameters.

• A good delivery is understood as an unhindered transfer of ownership of a security from the seller to the buyer in compliance with all necessary requirements.

• An instrument is an instrument for storing or transferring value or financial obligations.

• Investors use various financial instruments to get a rate of return to achieve financial goals and objectives.

• Notional principal amounts are used in interest rate swaps.

• Notional value is a term often used to value the underlying asset in derivatives trading.

• An offset transaction is an activity that cancels out the risks and rewards of another position or transaction.

• Open Trading Equity (OTE) is the amount of unrealized profit or loss on an open position before it is closed.

• Overnight positions are those that have not been closed by the end of the trading day.

• Price discovery is the process of determining the price of a given asset or commodity.

Fixing is the practice of fixing the price of a product instead of letting it be determined by the forces of the free market.#

• Financial instruments are traded for immediate delivery on the spot market.

• The spot price is the price that traders pay for an instant delivery of an asset such as a security or currency. They are in constant motion.

• Under water means that the asset is worth less than what was paid for it.

• To promote a position means to close it.

• Potential to increase the value of the investment, measured in money or percentage.

• In the financial markets, the term “widow maker” refers to a transaction that results in large, even catastrophic, losses.

• Alternative trading systems (ATS) are platforms for coordinating large purchase and sale transactions.

• Arbitrageurs are investors who exploit market inefficiencies of any kind. They are necessary to ensure that inefficiencies between markets are smoothed out or kept to a minimum.

• Ax (or “chopping axe”) refers to the desired position that the trader wants to take.

• A beneficial owner is a person who enjoys the benefits of ownership, despite the fact that the ownership of the property is registered in a different name.

• The bid-ask spread is the difference between the highest price a buyer is willing to pay for an asset and the lowest price a seller is willing to accept.

• Purchasing power is the money an investor has to buy securities.