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Contract

• A term of reference describing a unit of trading for a financial or commodity future. Also, the actual bilateral agreement between the buyer and seller of a transaction as defined by an exchange.

• A legally binding agreement between two or more parties.

 
 Embedded terms in definition
 Commodity
Exchange
Future
Trading
Unit
 
 Referenced Terms
 1035 exchange: Is a transaction that permits the exchange of a life insurance Contract for another insurance contract or annuity. It can be with the same or different company. It is important to research the specifics because some of the product exchanges only work one way. For example, an annuity can not be exchanged for a life policy.

 Actuals: The physical commodity underlying a futures Contract. Cash commodity, physical.Is the real or underlying asset for a derivative product or commodity market.The cash commodity as opposed to the futures Contract. Also known as cash or the spot.

 Actuals: The physical commodity underlying a futures Contract. Cash commodity, physical.Is the real or underlying asset for a derivative product or commodity market.The cash commodity as opposed to the futures Contract. Also known as cash or the spot.

 Adp: Is the Alternative Delivery Procedure at the New York Mercantile Exchange. It provides for longs and shorts to make and take delivery under terms which differ from those specified as good delivery for the Contract. These transactions can occur at any time during a delivery period.

 Advance commitment: A promise to sell an asset before the seller has lined up purchase of the asset. This seller can offset risk by purchasing a futures Contract to fix the sales price.

 
 Related Terms
 

<< Continuous random variable Contract month >>

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