OCC (Options Clearing Corporation)
| A clearing corporation owned jointly by the exchanges dealing in listed options. OCC is the central or main clearing corporation for listed options. Options traded on any SEC-regulated exchange can be settled through OCC.
|
OCC Prospectus
| A prospectus published by the OCC and available to option traders upon request. It contains information on trading options and the risks involved.
|
Odd Lot
| A quantity of securities that is smaller than the standard unit of trading, which is usually 100 shares.
|
Off Balance Sheet
| Products such as Interest Rate Swaps and Forward Rate Agreements are examples of `off balance sheet’ products. Also, financing from other sources other than equity and debt are listed.
|
Offer
| An indication of willingness to sell at a given price; opposite of a bid.
|
Offer for Sale
| A method of bringing a company to the market. The public can apply for shares directly at a fixed price. A prospectus containing details of the sale must be printed in a national newspaper.
|
Offer Or Asking Price
| The lowest price any potential seller is willing to accept for a particular option.
|
Offer Price
| The price at which the market maker will sell shares to investors.
|
Offset
| Liquidating a purchase of futures contracts through the sale of an equal number of contracts of the same delivery month, or liquidating a short sale of futures through the purchase of an equal number of contracts of the same delivery month. See Cover.
|
Offsetting Transaction
| A trade that serves to cancel or offset some or all of the market risk of an open position.
|
Omnibus Account
| An account carried by one futures commission merchant with another futures commission merchant in which the transactions of two or more persons are combined and carried in the name of the originating broker rather than designated separately.
|
On Track (or Track Country Station)
| A type of deferred delivery in which the price is set f.o.b. seller' location and the buyer agrees to pay freight costs to his destination.
|
One Cancels Other Order (O.C.O. Order)
| A contingent order where the execution of one part of the order automatically cancels the other part.
|
Open
| The period at the beginning of the trading session officially designated by the exchange during which all transactions are considered made "at the open."
|
Open Interest
| The total number of futures contracts long or short in a delivery month or market that has been entered into and not yet liquidated by an offsetting transaction or fulfilled by delivery. Also called Open Contracts or Open Commitments.
|
Open Order (or Orders)
| An order that remains in force until it is canceled or until the futures contracts expire. See Good 'Til Canceled and Good This Week orders.
|
Open Outcry
| Method of public auction required to make bids and offers in the trading pits or rings of commodity exchanges.
|
Open Position
| A deal not yet reversed or settled and the investor is subject to exchange rate movements.
|
Open Trade Equity
| The unrealized gain or loss on open positions.
|
Open-End Fund
| A mutual fund that makes a continuous offering of its shares and stands ready to buy its shares upon surrender by the shareholders. The share value is determined by net asset value of the fund.
|
Open-End Management Company
| A management company that is constantly issuing new shares.
|
Opening Price
| The price of a instrument (or option) at the first transaction of the day
|
Opening Purchase
| A transaction in which a speculator becomes the holder of an option.
|
Opening Range
| Range of closely related prices at which transactions took place at the opening of the market; buying and selling orders at the opening might be filled at any point within such a range.
|
Opening Sale
| A transaction in which a speculator becomes the writer of an option.
|
Opening Transaction
| Refers to a customer either buying or selling an option contract to open a new position.
|
Opening, The
| The period at the beginning of the trading session officially designated by the exchange during which all transactions are considered made "at the opening."
|
Option
| (1) A commodity option is a unilateral contract which gives the buyer the right to buy or sell a specified quantity of a commodity at a specific price within a specified period of time, regardless of the market price of that commodity. Also see Put and Call; (2) A term sometimes erroneously applied to a futures contract. It may refer to a specific delivery month, as the "July Option."
|
Option Adjustments
| Changes made in the terms of an option contract on ex-dividend date when the underlying stock pays a cash or stock dividend or when there is a stock split, etc.
|
Option Agreement
| The agreement the customer must sign to trade options in which the customer agrees to abide by the rules of the listed option exchanges.
|
Option Buyer
| The person who buys calls, puts, or any combination of calls and puts.
|
Option Class
| The group of options, put or call, with the same underlying security.
|
Option Contract
| A contract which gives the buyer the right, but not obligation, to buy (call) or sell (put) a commodity or futures contract at a specified price on or before a specified date. The seller of the option has the obligation to sell the commodity or futures contract or buy it from the option buyer at the exercise price if the option is exercised. See also Call (Option) and Put (Option).
|
Option Grantor
| The person who originates an option contract by promising to perform a certain obligation in return for the price of the option. Also known as Option Writer.
|
Option Premium
| The "price" a buyer pays for an option. Premiums are arrived at through open competition between buyers and sellers on the trading floor of the exchange.
|
Option Seller
| See Grantor.
|
Option Series
| The group of options having the same strike price, expiration date, and unit of trading on the same underlying stock.
|
Option Spread
| A position that results from the purchase of an option and the simultaneous sale (or "write") of a different option on the same instrument.
|
Option Writing "Naked Writing"
| The result of selling options in an opening transaction.
|
Options
| An agreement that allows the holder to have the option to buy/sell a specific security at a certain price within a certain time. Two types of options – call and put. A call is the right to buy while a put is the right to sell. One can write or buy call and put options.
|
Options And Futures Exchange
| Any or all of the following U.S. marketplaces (Exchanges) where option and futures contracts are traded. Chicago Board of Trade (CBT), Chicago Mercantile Exchange (CME), Coffee, Sugar and Cocoa Exchange (CSC), Commodity Exchange Inc. (COMEX), Kansas City Board of Trade (KCBT), Mid-America Commodity Exchange (MID-AM), Minneapolis Grain Exchange (MGE), New York City Cotton Exchange, (NYCE), New York Futures Exchange (NYFE), New York Mercantile Exchange (NYMEX).
|
Options Clearing Corporation (OCC)
| A clearing corporation owned jointly by the exchanges dealing in listed options. OCC is the central or main clearing corporation for listed options. Options traded on any SEC-regulated exchange can be settled through OCC.
|
Order
| An order is an instruction, from a client to a broker to trade. An order can be placed at a specific price or at the market price. Also, it can be good until filled or until close of business.
|
Order Book Official (OBO)
| An employee of certain exchanges who executes limit orders on behalf of the membership.
|
Order Department
| The department within a brokerage firm that is responsible for sending the customers’ orders to the proper market for execution.
|
Order Types
| Market Orders are the most commonly used in futures markets. They instruct the broker to buy or sell a given number of futures contracts in a given delivery month at the best price obtainable; the price is not specified. A "Limit Order" to either buy or sell also gives the market, the quantity, and the delivery month, but states the specific price level at which the order is to be filled. "Stop Orders" to buy or sell are commonly used either to protect profits or to cut losses. The stop order to buy could be used to protect a short position against a rising market; the buy stop order is activated when the futures market trades at the stop price or is bid at or above the stop price. The sell stop order could be used to protect a long position against a falling market; the sell stop order is activated when the futures market trades at the stop price or is offered at the stop price or below.
|
Ordinary Shares
| The most common form of share. Holders receive dividends which vary in amount in accordance with the profitability of the company and recommendations of the directors. The holders are the owners of the company. Also known as Common Stock.
|
Original Issue Zeros
| Zero-coupon securities originally issued by a corporation, government, or governmental subdivision as zeros. A zero-coupon security not created by severing interest and principal payments from a preexisting bond.
|
Original Margin
| Term applied to the initial deposit of margin money required of clearing member firms by clearinghouse rules, or to the initial margin deposit required of customers by exchange regulations.
|
Originate A Loan
| Make or issue a loan.
|
OTC Bulletin Board
| An electronic service that provides selected quotes on over-the-counter stocks.
|
OTC Options
| Options created by OTC firms.
|
Out Trade
| A trade which cannot be cleared by a clearinghouse because the trade data submitted by the two clearing members involved in the trade differs in some respect (e.g., price and/or quantity). In such cases, the two clearing members or brokers involved must reconcile the discrepancy, if possible, and resubmit the trade for clearing. If an agreement cannot be reached by the two clearing members or brokers involved, the dispute would be settled by an appropriate exchange committee.
|
Out-Of-The-Money
| A term used to describe an option that has no intrinsic value. For example, a call at $400 on gold trading at $390 is out-of-the-money 10 dollars.
|
Over The Counter (OTC)
| Used to describe any transaction that is not conducted over an exchange.
|
Overbought
| A technical opinion that the market price has risen too steeply and too fast in relation to underlying fundamental factors. Rank and file traders who were bullish and long have turned bearish.
|
Overnight
| A trade that remains open until the next business day.
|
Overnight Trade
| A trade which is not liquidated on the same trading day in which it was established.
|
Oversold
| A technical opinion that the market price has declined too steeply and too fast in relation to underlying fundamental factors. Rank and file traders who were bearish and short have turned bullish.
|
Over-The-Counter Market (OTC)
| Comprised of a network of telephone and telecommunication systems over which unlisted securities and other issues trade.
|
