Roll Forward: Extending Options Contracts

Benefits of Roll Forward Roll Forward is a powerful tool in the world of financial futures trading. It offers several benefits that can help traders maximize their profits and manage their risk effectively. 1. Flexibility One of the key benefits of Roll Forward is its flexibility. Traders have the option …

Implied Rate: Definition Calculation Formula Example

Implied Rate: Definition, Calculation, Formula, and Example The implied rate is a financial term used to describe the interest rate that is implied by the price of a financial instrument, such as a bond or a futures contract. It is derived from the market price of the instrument and represents …

Heating Degree Day Calculation: A Comprehensive Guide

What Are Heating Degree Days? Heating Degree Days (HDD) are a measure used in the field of energy consumption and weather forecasting. They provide valuable information about the amount of energy required to heat a building or space during a specific time period. When the average outdoor temperature is below …

Commodity Futures Contract Definition Example and Trading

Definition and Explanation A commodity futures contract is a legally binding agreement to buy or sell a specific quantity of a commodity at a predetermined price on a future date. It is a standardized contract traded on a futures exchange, which acts as an intermediary between buyers and sellers. Commodity …

Cash-and-Carry Arbitrage: Definition and Example

Cash-and-Carry Arbitrage: Definition and Example In the world of financial futures trading, one strategy that traders often employ is called cash-and-carry arbitrage. This strategy involves taking advantage of price discrepancies between the spot market and the futures market to make a profit. What is Cash-and-Carry Arbitrage? Cash-and-carry arbitrage is a …