Long A buyer of a futures contract. Someone who buys a futures contract is often referred to as being long that particular contract.
Short A seller of a futures contract. Someone who sells a futures contract is often referred to as being short that particular contract.
Margins A margin is cash or marketable securities deposited by an investor with his or her broker. The balance in the margin account is adjusted to reflect daily settlement. Margins minimize the possibility of a loss through a default on a contract.
Initial Margin Initial Margin for the Clearing Members proprietary positions will be based on the minimum margin required for a particular commodity and will vary from commodity to commodity.
Maintenance Margin Maintenance Margin will be 75% of the Initial Margin. Under no circumstances should the Maintenance Margin fall below this level.
Variation Margin Variation Margin payments will be made on a daily or intraday basis by the Clearing member to the Clearing House based on adverse price movement in positions carried by the Clearing Member, calculated separately for customer and proprietary positions.
Business Day A day when the exchange is open for trading.
Exposure Limits Exposure Limits are defined as the Maximum Open positions that Clearing Members can take across all Contracts.
Delivery If a contract is not closed out before maturity, it usually settled by delivering the assets underlying the contract. When there are alternatives about what is delivered, where it is delivered, and when it is delivered, the party with the short position chooses.
Open Interest Open Interest is the total number of contracts outstanding. It is equal to number of long positions or number of short positions.
Last Traded Price Last traded price is the price just before the final bell each day. It is used for the daily settlement process.
Volume of Trading Volume of Trading is the number of trades in 1 day.
Spot Price The current price at which a particular commodity can be bought or sold at a specified time and place.
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