Transfer funds by telegram from one center to another. It is now synonymous with electronic funds transfer between banks.
The term used in the foreign exchange market to call USD/GBP.
Buying options gives investors the right to purchase stocks, equity or options at a specific price, but it is not an obligation.
An option that gives the holder the right to purchase the underlying financial instrument at a specific price for a fixed period of time.
The collective term for a country's long-term and short-term import and export of capital.
Interest rate charges for holding financing securities or other financial instruments.
The financing costs required to store commodities (or foreign exchange contracts) from one delivery date to another.
Usually refers to the foreign exchange transaction agreed to settle on the transaction performance date. This term is mainly used in the North American market and countries that rely on foreign exchange services in the North American market due to different time zones, such as Latin America.
In Europe and Asia, cash transactions are often referred to as the value of transactions on the day.
Cash and Carry
Purchase the asset of the day and the option to sell this asset. Spot and futures can be converted into each other by selling assets and buying options.
A program that settles an option contract in which the cash difference between the option and the market price is paid instead of actual delivery.
Chicago Board Options Exchange.
CBOT or CBT
Chicago Board of Trade.
proof of deposit.
The central bank provides financial and banking services to the government and commercial banks of the country. It also implements the government's monetary policy by changing interest rates.
The Reserve Bank of India is the central bank of India. It plays a role in maintaining an orderly foreign exchange market and intervenes using various financial tools such as the Huai reserve rate, bank interest rates, open market operations and moral persuasion.
The exchange rate of each currency used in the European Monetary System (EMS) to the European Currency Unit (ECU). The currency fluctuates within a certain range of the central exchange rate according to the corresponding floating range.
Certificate of Deposit (CD)
A transferable deposit certificate issued by a commercial bank in the form of pay-on-demand as evidence of deposit, with the maturity value, maturity date and interest rate payable on it. The expiration date of a CD varies from a few weeks to a few years.
CDs can usually only be repaid in the form of being sold on the secondary market before the expiry date, but they can also be redeemed after paying a fine to the issuing bank.
CFTC-Commodity Futures Trading Commission
The Commodity Futures Trading Commission, the federal regulatory agency of the United States, regulates futures trading in commodity markets including financial futures.
Automatic payment system for clearing exchanges.
Chart experts study the graphs and charts of historical data in order to find trends and predict future trend reversals. This includes the observation of specific shapes and characteristics of the chart to derive resistance levels, head and shoulder shapes, and double bottoms or double peaks that are considered to indicate a trend reversal.
New York Clearing House clearing system. (Clearing House Interbank Payment System). Most euro transactions are cleared and settled through this system.
The Copenhagen Interbank Offered Rate is the interest rate at which banks lend Danish kroner on an unsafe basis. This interest rate is calculated daily by the Danish National Bank (the central bank of Denmark) based on the principles set by the Danish Bankers Association.
The execution of a transaction makes it give zero commitment to the market of a particular currency.
Closing Purchase Transaction
Purchase an option equivalent to a sold option to liquidate a position.
Chicago Mercantile Exchange.
An economic indicator usually fluctuates with the general business cycle, such as the industrial production cycle.
New York Mercantile Exchange.
The transaction agency fee charged by the broker to the client.
For an option-based option, the date and price of the underlying option are fixed.
A memo to the other party describing all the details of the transaction.
Consumer Price Index. A monthly measurement of changes in the price of a defined consumer basket of goods, including food, clothing, and transportation. Different countries use different methods for rent and mortgages.
Contract Expiration Date
The date on which the currency must be delivered to fulfill the terms of the contract.
For an option, it is the last day on which the option holder can exercise his right to buy or sell the underlying financial instrument or currency.
If it is not liquidated or sold before a specified date, the month in which an option contract expires or can be delivered.
An agreement to buy or sell a specified number of currencies or options in a specified month in the future. (See forward contract)
A foreign bank that regularly provides services to a bank that does not have a branch in the relevant center, such as coordinating the transfer of funds. Due to restrictions on banking services between states in the United States, this situation often occurs in the United States.
Cost of Carry
According to the theory of interest rate parity, the forward price is determined by the cost of borrowing to maintain a position.
Cost of Living Index
In a broad sense, it is equal to the retail price index or the household consumption index.
The client or bank corresponding to the execution of foreign exchange transactions.
The foreign exchange interbank exchange (foreign exchange market) instrument is the position (call and/or put) between the customer and the counterparty. It is different from the foreign exchange instrument in the on-exchange market. It is actually related to the transaction of a financial instrument. The clearing agency guarantees foreign exchange transactions, and there is no guarantee from the clearing agency.
Therefore, when a customer purchases an over-the-counter (OTC) foreign exchange instrument, it relies on the counterparty from whom the instrument is purchased to fulfill the contract.
The inability of the counterparty to fulfill the position will result in the loss of any previous payment for the follow-up position, as well as the loss of the expected profit of the transaction.
Risks associated with government intervention (excluding central bank intervention). Typical examples include legal and political events, such as wars, or domestic disturbances.
The annual interest rate of the bond interest.
(1) On bearer stocks, the detachable part behind the status of the issuer. Proof of redeemable bonus.
(2) Represents the interest rate of a security with a fixed interest.
(1) Close a forward foreign exchange contract.
(2) Buying sold currencies or securities to settle a short position.
Covered Interest Rate Arbitrage
An arbitrage method. Borrow currency A, convert it into currency B, and then use currency B to invest during the loan period. When the loan expires, the investor will make a profit from the entire transaction.
This approach is based on the interest rate parity theory (an important theoretical economic relationship), that is, a foreign investment that is hedging is exactly equal to the domestic interest rate of the same venture investment.
When the difference in covering interest rates between the two currency markets is zero, there will be no arbitrage incentive to transfer funds from one market to another.
Payment and Clearing System Committee
Crawling pegging exchange rate system (adjustable pegging)
An exchange rate system in which the exchange rate of a country is "pegged" (also called fixed) to another currency. The official exchange rate can be changed at any time.
The risk of the debtor not repaying the debt; more specifically, the currency that the counterparty has not promised to deliver.
A foreign exchange transaction includes two currencies, but these two currencies are not Jihuai currencies.
Based on the observation that the price of financial instruments fluctuates simultaneously, the method of using financial futures to hedge different but related cash instruments.
The exchange rate between two currencies is usually constructed by the respective exchange rates of the two currencies, because most currencies are quoted against the U.S. dollar.
Cross trading is that the buyer's broker and the seller's broker are the same person, or the buyer's broker and the seller's broker belong to the same company.
The type of money used by a country. It can be exchanged for other currencies in the foreign exchange market, so each currency has a relative value to other currencies.
Other currencies are combined with different weights relative to a basket of currencies (such as ECU or SDR). Sometimes used by the currency system, the currency exchange rate is usually fixed on a weighted basket of currencies. It is a group of selected currencies whose weighted average is used to measure the value of the currency or the amount of debt. Currency baskets are usually used in contracts to prevent (or minimize) risks caused by currency fluctuations.
The net balance of a country’s export and import balance of payments and unilateral transfers, such as aid and immigration remittances. It excludes capital flows.
In a specified period of time, the value of all exports (goods plus services) of a country minus the value of all imports is equal to the sum of international trade and off-book balances plus net interest, profits and dividends received from abroad.
Applicable to the combination of expiry dates of options of different classes.
If the order is not executed on the specified day, it will be automatically cancelled.
Daily trading is a currency exchange transaction that automatically renews every night at 22:00 (GMT time) from the trading start day to the end day. The transaction ends in any of the following situations:
- You request a suspension.
- The daily trading interest rate reaches your predetermined stop-loss interest rate.
- The transaction reaches the end date.
As long as the transaction is open, a renewal fee will be charged at 22:00 (GMT time) every night.
The agreed date of the transaction.
The main method of recording the basic information of a transaction.
A person who acts as a principal or counterparty in a transaction. Place a buy or sell order, hoping to make a difference (profit) from it. The difference is that a broker is a person or company that acts as an intermediary and collects commissions for matching buyers and sellers.
The option buyer must inform the seller of the last date or time when he is willing or unwilling to exercise the option.
Insufficient trade balance, payment balance, or government budget.
The actual delivery behavior of the ownership of the transaction currency transferred by both parties to the transaction.
The expiry date of the contract is the date when the transaction is finally cleared through exchange of currencies. This date is more commonly called expiration date.
A term used to describe when the counterparty cannot complete its own transaction. This kind of risk is very high in store market transactions, and there is no exchange as a guarantee for the transactions of both parties to the contract.
The change in the value of the premium paid entirely by the market value of the reserve fund is expressed in the form of a coefficient with reference to the instant change in the value of the underlying financial instrument.
A method used by option sellers to avoid the risk exposure of selling options by buying or selling the underlying financial instruments in proportion to delta.
The ratio arbitrage of an option uses a neutral position established by the delta of the related option to determine the hedging ratio.
A broad term referring to risk management tools such as futures, options, exchanges, etc. The fluctuation of the contract value is related to the underlying instrument or currency. Considering the large losses caused by banks and consortia, the issue of derivatives and their control has become the subject of many controversies.
Refers to a team that trades a specific currency or other currencies.
All the information needed to complete a foreign exchange transaction, namely name, interest rate, date and delivery point.
Usually due to official announcements, the value of one currency is deliberately lowered against the value of another currency.
When quoting, a certain unit of foreign currency is converted into a certain amount of domestic currency.
Less than the spot price. For example: forward discounting.
The interest rate at which the bill of exchange is discounted. Specifically, it refers to the interest rate at which the central bank prepares some bills of exchange discounted by financial institutions. This is a means to alleviate the pressure on funds. It is more accurately called the official discount rate.
The interest rate applicable to domestic deposits. Because of taxes and different market activities, the value and face value of euro deposits in Europe may be different.