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Glossary of Terms
As the commerce and industry have evolved, each sector has developed a vocabulary that uniquely describes its products,
technology, and business practices, known as a jargon of respective domain. Often, these words seem incomprehensible to
the layman. This short lexicon is not meant to be a comprehensive dictionary of markets; nevertheless it would be a useful
guide for the beginners who are keen to no more about financial markets and futures industry.
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Immediate or Cancel :-
An order which must be filled immediately
or be canceled. IOC orders need not be filled in their entirety.
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Implied Volatility :-
A measurement of the market's expected price
range of the underlying commodity futures based on market-traded options
premiums.
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In-the-Money :-
An option that can be exercised and immediately
closed out against the underlying market for a cash credit. The option
is in-the-money if the underlying futures price is above a call option's
strike price, or below a put option's strike price. .
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Intrinsic Value :-
The amount by which an option is in-the-money.
An option which is not in-the-money has no intrinsic value. For calls,
intrinsic value equals the difference between the underlying futures price
and the option's strike price. For puts, intrinsic value equals the option's
strike price minus the underlying futures price.Intrinsic
value is never less than zero.
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Introducing Broker :-
A firm engaged in soliciting or in accepting
orders for the purchase or sale of any commodity for future delivery.
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Inverted Market :-
A futures market is said to be inverted when distant contract months are selling at a discount to nearby contract months; also known as backwardation.
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Invisible Supply :-
Uncounted stocks of a commodity in the hands
of wholesalers, manufacturers and producers which cannot be identified
accurately; stocks outside commercial channels but theoretically available
to the market.
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