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Details Title: Series 3 Description: Series 3 Review Total Flash Cards: 28 Created: 07/18/2006 06:31:22	To study from this set of flash cards, or to create your own your own study flash cards, register HERE. If you are already a registered user, CLICK HERE.
Cards Term carrying charges Definition insurance storage interest and other incidental costs Term margin Definition not downpayment but a performance bond or earnest money Term commoditiy account agreement Definition authorizes liquidation of an account w/out notice Term Contracts settled in cash Definition feeder cattle lean hogs stock indexes and eurodollar time deposits Term Call Exercising Definition buyer - long position seller - short position Term Put Exercising Definition Buyer - Short position Seller - Long positions Term omnibus account Definition an account with a futures c ommission house in which the transactions and identification of two or more persons are combined and not disclosed Term buy stop order Definition above market price made a market order when price is at or above stop limit losses on short position establish long position Term sell stop order Definition placed below mkt price made mkt order @ or below stop price limit losses on long position establish short position Term MIT Definition market if touched not allowed on CBOT, allowed on CME lower priority Term buy MIT Definition below mkt price establish long position or close short Term sell MIT Definition above current mkt price est. short position or close long position Term Limit order Definition buy at specific price dotn move once limit reached dotn become market Term Notation OB necessary when Definition the price is already better than the limit price Term OCO Definition One Cancels Other Term churning Definition excessive trading to generate commision Term Stock Index Futures Definition S&P500 Index, New York Stock Exchange Composite, Value Line Average, Major Market Index, Nikkei 225 Stock Average, Term Beta Definition correlate the price movement of the stocks in the portfolio with the movement of the stock index Average is 1 so whatever the index decline is, the portfolio would be expected to decline the same amount Term short term instruments Definition fed funds, tbills, eurodollar time deposits (25$) Term long-term instruments Definition t-notes, t-bonds, GNMA's - 31.25 Term Inter delivery Definition aka - intra-market or intra-commodity spread on same exchange, same commodity, different delivery month Term inter-market Definition same commodity different exhanges Term inter-commodity Definition 2 different commodities with same delivery month on different exchange Term soybean crush Definition long soybean futures with short soybean oil and meal futures... profit if narrows Term crack spread Definition crude oil futures and heating oil and gasoline futures Term calculate spread Definition nearby-deffered = spread Term compare spreads Definition calculate per month rather than absolute divide spread using formula, by number of monts elapsing ex: june/sept spread divide by 3 Term delta Definition correlation between the movement of the option premium and the price of the underlying futures delta changes constantly as the option premium changes due to the two components of the premium