close out
Parties to a futures contract are said to close out (or closeout) the contract when they eliminate their obligation to deliver or take delivery of the commodities or securities. By doing this they seek to end their exposure to changes in the value of the future; while it is open, the future will be affected by changes in the price of the underlying commodity or security. The parties close out a future by entering into a second off-setting future with another party, or by agreeing with the other party to the future to cancel it in return for a compensating payment that reflects the change in value of the future since it was entered into.

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

Look at other dictionaries:

  • close|out — «KLOHZ OWT», noun. a sale held to close out some or all of the goods handled by a business …   Useful english dictionary

  • close-out — index lockout Burton s Legal Thesaurus. William C. Burton. 2006 …   Law dictionary

  • close out — verb 1. make impossible, especially beforehand • Syn: ↑preclude, ↑rule out • Derivationally related forms: ↑preclusive (for: ↑preclude) • Hypernyms: ↑ …   Useful english dictionary

  • close out — verb Date: 14th century transitive verb 1. a. exclude b. preclude < close out his chances > 2. a. to dispose of a whole stock of by sale b. to dispose of (a …   New Collegiate Dictionary

  • close·out — /ˈkloʊzˌaʊt/ noun, pl outs [count] US 1 a : a sale in which a store tries to sell all of its products because the store is going out of business a store closeout 1 b : a sale to sell all of the old models of a product so that a store can sell the …   Useful english dictionary

  • close out — Synonyms and related words: balance, balance the books, bar, book, button up, cap, capitalize, carry, carry over, carry to completion, cast up accounts, charge off, clean up, clear the trade, climax, close the books, close up, complete, conclude …   Moby Thesaurus

  • close out — (Roget s Thesaurus II) verb To get rid of completely by selling, especially in quantity or at a discount: dump, sell off, sell out, unload. See TRANSACTIONS …   English dictionary for students

  • close out — verb a) Of a wave, to break all at once, instead of progressively along its length. b) To terminate a computer program. Ant: open up See Also: closeout …   Wiktionary

  • close (out) — A transaction which extinguishes commitments to the markets, i.e. a purchase if the initial transaction was a sale and vice versa. Dresdner Kleinwort Wasserstein financial glossary See also closing purchase and closing sale. Dresdner Kleinwort… …   Financial and business terms

  • close out — A transaction which leaves the trade with a zero net commitment to the market. A purchase if the initial transaction was a sale and vice versa. Exchange Handbook Glossary …   Financial and business terms

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