basis — The difference between the current cash price and the futures price of the same commodity. Unless otherwise specified, the price of the nearby futures contract month is generally used to calculate the basis. Chicago Board of Trade glossary The… … Financial and business terms
basis trading — is the simultaneous entry into both a cash position for a particular product and an equal and opposite futures position on the same underlying. A basis trader looks to profit from a change in the relationship between the cash price and the future … Financial and business terms
Basis risk — in finance is the risk associated with imperfect hedging using futures. It could arise because of the difference between the asset whose price is to be hedged and the asset underlying the derivative, or because of a mismatch between the… … Wikipedia
Basis trading — is an arbitrage strategy usually consisting of the purchase of a particular security and the sale of a similar security (often the purchase of a security and the sale of a corresponding futures contract). Basis trading is done when the investor… … Wikipedia
futures — Commercial contracts calling for the purchase or sale of specified quantities of a good at specified future dates. The good in question may be grain, livestock, precious metals, or financial instruments such as treasury bills. Up until the time… … Universalium
Futures contract — Financial markets Public market Exchange Securities Bond market Fixed income Corporate bond Government bond Municipal bond … Wikipedia
Basis — Regarding a futures contract, the difference between the cash price and the futures price observed in the market. Also, it is the price an investor pays for a security plus any out of pocket expenses. It is used to determine capital gains or… … Financial and business terms
Basis Trading Facility — ( BTF) A system operated on the LIFFE market for certain bond futures which allows for the simultaneous execution of cash and futures trades ( basis trades) without entering the futures pit. Dresdner Kleinwort Wasserstein financial glossary (… … Financial and business terms
Basis future — In the context of financial futures, basis of futures can be defined as the spot price minus the futures price. There will be a different basis for each delivery month for each contract. In a normal market, basis will be negative. This reflects… … Wikipedia
Basis — 1. The variation between the spot price of a deliverable commodity and the relative price of the futures contract for the same actual that has the shortest duration until maturity. 2. A security s basis is the purchase price after commissions or… … Investment dictionary
Basis Grade — The minimum accepted standard that a deliverable commodity must meet to be used as the actual of a futures contract. Also known as par grade or contract grade. Basis grade is important for futures investors for maintaining uniformity, since a… … Investment dictionary