Naked

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

• Arbitrage
• Carry trade
• Derivative
• Forward contract
• Futures contract
• Hedging
• Option
• Outturn
• Speculation