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Convergence

It is an essential concept in financial markets.

As we dive into the world of finance, it's important to understand the concept of convergence. This term refers to the gradual alignment of the futures contract's price with the spot or cash price of the underlying securities. In simpler terms, it's the process of closing the gap between the two prices over time. This plays a crucial role in the functioning of financial markets, making it a fundamental concept to grasp.

Exercise

This can happen at anytime before the options contract expires. Options trading involves the concept of "exercising," which refers to the act of utilizing the right to buy ...

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Expiration Time

This date is determined by the exchange on which the contract is traded. When we talk about expiration time in the context of finance, we are referring to the specific date ...

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Forward Contract

This type of contract is used to manage business risks, such as fluctuations in commodity prices or foreign currency exchange rates. A forward contract is a legally binding a...

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Futures Contracts

This asset can be a commodity, stock, currency, or any other financial instrument. A fundamental concept in finance, Futures Contracts are powerful tools used to manage ris...

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