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Reverse Cash and Carry

A cash and carry transaction that is reversed. It involves the simultaneous sale of a cash market commodity/ instrument for...

Spot Price

The price at which a commodity or a financial instrument (a derivative) for immediate delivery is selling at a specific...

Carrying Charges

The sum of all expenses incurred on holding an asset, literally: storage, insurance and financing costs, subtracted from the income...

Cost of Carry

The sum of all expenses incurred on holding an asset, literally: storage, insurance and financing costs, subtracted from the income...

Basis Point Upfront Roll-Down

A roll-down in which an investor expresses a notional neutral curve switch. This carry is expressed in basis points upfront...

Basis Point Upfront

A measure of basis points as absolute spread or return. For example, if the expected carry for a swap (carry...

Carry Trade

A currency trading/ speculation strategy that involves borrowing in low-interest currencies (low-yielding currencies) in order to invest in high-interest currencies...

Basis Point Running

A measure of basis points as relative spread or return that would make the carry disappear. In other words, it...

Net Basis

The basis amount that results from adjusting the gross basis for net carry. Net carry is the actual coupon income...

Cash-and-Carry Trade

Going long the basis, or more specifically the purchase of a cash-market investment instrument such as cash bonds or index...