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Derivatives

Customer Margin

As we delve into the world of futures, it is crucial to understand the concept of Customer Margin. This term refers to the monetary assurance needed from individuals purchasing or selling futures contracts, as well as those selling options contracts. Essentially, it serves as a safeguard to ensure that all contractual obligations are met. Without this financial guarantee, the futures industry would be vulnerable to potential defaults. Thus, understanding Customer Margin is crucial in navigating the complex world of finance.

Basis

In finance, we often refer to basis as the discrepancy between the current price of a security and the price of its corresponding futures contract. This can be thought of as...

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Holder (Option Buyer)

The holder, also known as the owner, of an option contract possesses the privilege to exercise the option within its duration. This privilege is acquired by the holder throu...

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Out-of-the-money

An option that would result in a loss upon immediate exercise is known as an out-of-the-money option. Specifically, a Call option is considered out-of-the-money when the cur...

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Deep Discount Bonds

Deep Discount Bonds, also referred to as zero-coupon bonds, are financial instruments that are acquired at a fixed face value, and the full amount of the investment is paid ...

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