Dishonour and Naked: Difference between pages

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imported>Doug Williamson
m (Category added 8/10/13)
 
imported>Doug Williamson
(Create the page. Source: ACT qualifications material.)
 
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''Law.''
A 'naked' position in a derivatives contract is one where the holder has no other related offsetting contract, asset or liability.
 
The only possible profit or gain is from a favourable outturn market price.
 
Naked positions are, by definition, speculative (rather than hedging).


In commercial law, the failure to honour a negotiable instrument. This may be by non-acceptance, or by non-payment.


== See also ==
== See also ==
* [[Negotiable instrument]]
* [[Arbitrage]]
 
* [[Derivative]]
[[Category:Regulation_and_Law]]
* [[Futures]]
* [[Hedging]]
* [[Option]]
* [[Outturn]]
* [[Speculation]]

Revision as of 10:05, 7 October 2015

A 'naked' position in a derivatives contract is one where the holder has no other related offsetting contract, asset or liability.

The only possible profit or gain is from a favourable outturn market price.

Naked positions are, by definition, speculative (rather than hedging).


See also