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Trading Terms

Forward contract -optional term

When an importer is unsure of the exact delivery date, they may encounter a situation where the contract rate is adjusted against them if they enter into a fixed term contract and are required to deliver significantly earlier than the expiry date. This uncertainty can be avoided by entering into a contract with a firm rate that applies for delivery within a specified period, typically 15 to 30 days. In this case, deliveries within the optional period would be executed at the contract rate, while earlier deliveries would require an adjustment to the rate, similar to pre-deliveries in fixed term contracts.

Delay

In the world of finance, we often come across the concept of "lag time". This refers to the time it takes for an input event to cause a change in an output event or time seri...

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NFO (New Funds Offer)

A new fund offering, or NFO, is essentially a way for an asset management company (AMC) to gather funds from the market and invest them in various securities. It can be seen...

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Near-the-Money

A "near-the-money" option is one with a strike price that is very close to the current price of the underlying asset. This type of option is often considered to have a highe...

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Intraday Trading

It is a high-risk, high-return investment strategy that requires a thorough understanding of market trends and the ability to make quick decisions. Day traders often utilize ...

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