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Financial instruments are traded for immediate delivery on the spot market. Many assets list “spot price” and “future or forward price”. Most trades in the spot market have a T+2 settlement date. Operations in the spot market can be carried out on the exchange or over the counter (OTC). Spot markets can be contrasted with derivatives markets, which instead trade forward, futures or options contracts. Break Even Point
September 25, 2022 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. Break-Even Price
September 25, 2022 The break-even price describes the change in value that only corresponds to covering the initial investment or cost. Ex-Ante
September 25, 2022 Preliminary analysis in financial markets refers to the forecasting of various indicators, economic and financial, by evaluating past and present data and parameters. Good Delivery
September 25, 2022 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. Instrument
September 25, 2022 An instrument is an instrument for storing or transferring value or financial obligations. Investor
September 25, 2022 Investors use various financial instruments to get a rate of return to achieve financial goals and objectives. Negative Carry
September 25, 2022 Negative carryover is a condition in which holding on to an investment costs more than it earns in the short term. Notional Principal Amount
September 25, 2022 Notional principal amounts are used in interest rate swaps. Notional Value
September 25, 2022 Notional value is a term often used to value the underlying asset in derivatives trading. Offsetting Transaction
September 25, 2022 An offset transaction is an activity that cancels out the risks and rewards of another position or transaction. Open Trade Equity (OTE)
September 25, 2022 Open Trading Equity (OTE) is the amount of unrealized profit or loss on an open position before it is closed. Overnight Position
September 25, 2022 Overnight positions are those that have not been closed by the end of the trading day. Price Discovery
September 25, 2022 Price discovery is the process of determining the price of a given asset or commodity. Price Fixing
September 25, 2022 Fixing is the practice of fixing the price of a product instead of letting it be determined by the forces of the free market.# Spot Price
September 25, 2022 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. Underwater
September 25, 2022 Under water means that the asset is worth less than what was paid for it. Unwind
September 25, 2022 To promote a position means to close it. Upside
September 25, 2022 Potential to increase the value of the investment, measured in money or percentage. Widow Maker
September 25, 2022 In the financial markets, the term “widow maker” refers to a transaction that results in large, even catastrophic, losses. Alternative Trading System (ATS)
September 25, 2022 Alternative trading systems (ATS) are platforms for coordinating large purchase and sale transactions. Arbitrageur
September 25, 2022 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. Axe
September 25, 2022 Ax (or “chopping axe”) refers to the desired position that the trader wants to take. Beneficial Owner
September 25, 2022 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. Bid-Ask Spread
September 25, 2022 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. Buying Power
September 25, 2022 Purchasing power is the money an investor has to buy securities.