||A market which often is subject to wide price fluctuations is said to be volatile. This volatility is often due to a lack of liquidity.
||The ones where the price moves vigorously and unpredictably. Some commodities are more volatile in character than others but volatility is mainly a varying characteristic that affects all markets at different times.
||A measurement of the change in price over a given period. It is often expressed as a percentage and computed as the annualized standard deviation of the percentage change in daily price.
||Strategies designed to speculate on changes in the volatility of the market rather than the direction of the market.
||The number of purchases or sales of a commodity futures contract made during a specific period of time, often the total transactions for one trading day.
||The number of futures contracts, calls, or puts traded in a day. Volume figures use the number of longs or shorts in a day, not both. Such figures are reported on the following day.
||Volume of Trade
||The number of contracts traded during a specified period of time. It may be quoted as the number of contracts traded or as the total of physical units, such as bales or bushels, pounds or dozens.
||Document guaranteeing the existence and availability of a given quantity and quality of a commodity in storage; commonly used as the instrument of transfer of ownership in both cash and futures transactions.
||Denotes the situation where a financial institution carries an open position on it books until a suitable long term counter party can be found.
||Instrument which gives the holder the right (but not the obligation) to buy shares directly from the company at a fixed price some time in the future. a type of call option.
||An illegal process in which simultaneous purchases and sales are made in the same commodity futures contract, on the same exchange, and in the same month. No actual position is taken, although it appears that trades have been made. It is hoped that the apparent activity will induce legitimate trades, thus increasing trading volume and commissions.
||A term often used to describe an option because of its limited life. Shortly before its expiration, an out-of-the-money option has only time value, which declines rapidly. For an in-the-money option, only intrinsic value is left upon expiration. For futures options, this is either automatically exercised or cashed out. At the end of its life, an option that has no intrinsic value becomes worthless; i.e., it wastes away.
||A relatively large difference between cash prices and futures prices. A weak basis also can be called a "wide basis," or a "more negative basis": for example, a weak basis usually occurs in grains at harvest time when supplies are abundant. Buyers can lower their bids to buy. As the cash prices decline, relative to futures prices, the basis weakens (gets wider). A weak basis indicates a poor selling market, but a good buying market.
||Empirical anomaly which describes the fact that shares have lower returns on Mondays than on other days of the week, catteries paribus, see January effect, small firm effect.
||A corporation's current assets less its current liabilities.
||See Option Seller.
||One who sells an option. A "writer" (or grantor) obligates himself to deliver the underlying futures position to the option purchaser, should he decide to exercise his right to the underlying futures contract position. Option writers are subject to margin calls because they may have to produce the long or short futures position. A call writer must supply a long futures position upon exercise, and thus receive a short futures position. A put writer must supply a short futures position upon exerci
||1) The production of a piece of land; e.g., his land yielded 100 bushels per acre. 2) The return provided by an investment; for example, if the return on an investment is 10%, the investment yields 10%.
||A measure of the annual return on an investment.
||A chart in which the yield level is plot on the vertical axis and the term to maturity of debt instruments of similar creditworthiness is plotted n the horizontal axis.