Commercial: Commercial is an entity that is involved in the production, processing, or merchandising of a commodity.
Contract: Contract is a term of reference describing a unit of trading for a commodity future or option. At the same time contract is an agreement to buy or sell a specified commodity, detailing the amount and grade of the product and the date on which the contract will mature and become deliverable.
Dealer: A Dealer is an individual or firm that acts as a market maker in an instrument such as a security or foreign currency.
Exchange: A central marketplace with established rules and regulations where buyers and sellers meet to trade futures and options contracts or securities. Exchanges include designated contract markets and derivatives transaction execution facilities.
Floor Trader: A person, individual with exchange trading privileges and who is a member of an exchange and who executes his own trades by being personally present in the pit or ring for futures trading. See Local.
Futures: Futures (also called Futures Contract) is a legally binding agreement to buy or sell a commodity or financial instrument at a later date. Futures contracts are normally standardized according to the quality, quantity, delivery time and location for each commodity, with price as the only variable.
Futures Contract: Futures Contract is an agreement to purchase or sell a commodity for delivery in the future: (1) at a price that is determined at initiation of the contract; (2) that obligates each party to the contract to fulfill the contract at the specified price; (3) that is used to assume or shift price risk; and (4) that may be satisfied by delivery or offset.
High: High is the highest price of the day for a particular futures or options on futures contract.
Liquidity: Liquidity (Liquid Market) is a characteristic of a security or commodity market with enough units outstanding and enough buyers and sellers to allow large transactions without a substantial change in price.
Local: Local is a member of an exchange who trades for his own account. Traditionally Local trades on an exchange floor, and Local's activities provide market liquidity.
Low: Low is the lowest price of the day for a particular futures or options on futures contract.
Offer: Offer is an indication of willingness to sell futures contract at a given price. Offer is opposite of bid, the price level of the offer may be referred to as the ask.
Ring: Ring is a circular area on the trading floor of an exchange where traders and brokers stand while executing futures trades. Some exchanges use pits rather than rings.
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Naked options trading is very risky - many people lose money trading them. It is recommended contacting your broker or investment professional to find out about trading risk and margin requirements before getting involved into trading uncovered options.