Glossary

Shock Absorber

See Also:

Break: Break (Price Break) is a rapid and sharp price decline.

CIF: CIF is the cost, insurance, and freight paid to a point of destination and included in the price quoted.

Circuit Breaker: Circuit Breaker is a system of trading halts and price limits on equities and derivatives markets designed to provide a cooling-off period during large, intraday market declines or rises. The first known use of the term circuit breaker in this context was in the Report of the Presidential Task Force on Market Mechanisms (January 1988), which recommended that circuit breakers be adopted following the market break of October 1987.

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.

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.

Futures Price: Futures Price could be referred to the price of a commodity for future delivery that is traded on a futures exchange or Futures Price could refer to the price of any futures contract.

Low: Low is the lowest price of the day for a particular futures or options on futures contract.

Rally: Rally is an upward movement of prices.

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