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Akhilesh Ganti

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Articles by Akhilesh Ganti

Understanding STOXX European Indexes: Key Indices and Features

19 days ago|

By James Chen, Akhilesh Ganti, Betsy Petrick |Investopedia Verified

What Is STOXX? STOXX, part of Deutsche-Borse Group, offers key market indexes for both Europe and global markets. Some of the more notable indexes provided by STOXX include Euro Stoxx 50, Stoxx Euro 600, Euro Stoxx 50 ESG, and the Stoxx Global 1800. STOXX partners with major financial institutions worldwide. Key Takeaways STOXX, a subsidiary of Deutsche-Borse Group, provides key European market indexes like the Euro Stoxx 50 and Stoxx Europe 600.

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National Market System: Definition, Functions & Regulations for U.S. Exchanges

21 days ago|

By James Chen, Akhilesh Ganti, Liz Manning |Investopedia Verified

Key Takeaways The National Market System (NMS) ensures transparency by regulating trade disclosures and executions on major U.S. exchanges and NASDAQ. Reg NMS, issued in 2005, strengthens the NMS and includes rules like the Order Protection Rule to ensure best price execution. NMS requires exchanges to make bids and offers visible to investors, enhancing liquidity but potentially driving large trades to private exchanges.

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Synthetic Futures Contracts: How They Work and Manage Risks

a month ago|

By Akhilesh Ganti, Kirsten Schmitt, Somer Anderson |Investopedia Verified

Key Takeaways A synthetic futures contract mimics a traditional futures position using put and call options with the same strike price and expiration date. These contracts allow traders to take a synthetic long or short position, offering similar market exposure without direct futures agreements. A synthetic long position is created by buying calls and selling puts with identical strike prices and expiration dates.

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Market Risk vs. Specific Risk: Key Differences You Need to Know

2 months ago|

By Steven Nickolas, Katrina Avila Munichiello, Akhilesh Ganti |Investopedia Verified

Key Takeaways Market risk, or systematic risk, impacts a broad spectrum of assets and cannot be diversified away. It is influenced by macroeconomic factors. Unsystematic risk, or specific risk, is unique to a company or industry and can be mitigated through diversification across different asset classes. Beta measures an investment's volatility compared to the market; a portfolio with a beta of 2 is 100% more volatile than the market.

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Boost Portfolio Income: Top Strategies Using Option Writing

2 months ago|

By Jeff Krohnfeldt, Kirsten Schmitt, Akhilesh Ganti |Investopedia Verified

Key Takeaways Option writing strategies generate consistent income through puts and calls, lowering purchase costs and providing income from premiums. Selling puts helps reduce the purchase cost by buying shares below market price if the option expires in the money. Covered calls generate income while holding stocks, with the potential risk of shares being called away if options expire in the money.

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A Comprehensive Guide to Inflation Swaps and Their Benefits

2 months ago|

By Akhilesh Ganti, Charles Potters |Investopedia Verified

Key Takeaways An inflation swap allows one party to exchange fixed cash flows for inflation-indexed payments, transferring inflation risk to another party. One party in an inflation swap pays a fixed rate, while the other party pays a rate linked to an inflation index, such as the CPI. Inflation swaps are primarily used by institutional investors and governments to hedge against inflation and anticipate expected inflation rates.

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Price Change: Definition, Types, Causes & Effects

3 months ago|

By Carla Tardi, Akhilesh Ganti |Investopedia Verified

Key Takeaways Price change refers to the difference between a security's closing price on a trading day and its closing price on the previous trading day. A security's price likely is the most visible barometer of an issuer's financial health. Predicting price changes is one of the most critical parts of an analyst's job. Get personalized, AI-powered answers built on 27+ years of trusted expertise. What Is a Price Change?

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What Is Physical Delivery? Definition and How It Works in Trading

3 months ago|

By James Chen, David Rubin, Akhilesh Ganti |Investopedia Verified

Key Takeaways Physical delivery requires the actual asset delivery in futures or options rather than settling with cash. Derivatives contracts can be cash-settled or physically delivered at expiry. Physical delivery is typical in commodities and bonds, involving a transfer of assets upon contract expiration. Exchanges regulate delivery specifics, including location, quality, and asset grade. Physical delivery involves brokers clearing transactions post-trade to fulfill contract obligations.

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Cash Trading Explained: Definition, Rules, and Comparison with Margin Trading

3 months ago|

By Akhilesh Ganti, Somer Anderson |Investopedia Verified

Key Takeaways Cash trading involves buying with funds that are present in the brokerage account, without using margin. The SEC requires that certain trades must settle within one business day (T+1), improving the speed of transaction finality. Violations like cash liquidation, free riding, and good faith violations are risks in cash trading and are prohibited by the SEC and FINRA.

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What Is Underlying? Definition, Meaning, Pros, Cons, and Example

2 years ago|

By Will Kenton Verified, Akhilesh Ganti |Investopedia Verified

Key Takeaways An underlying asset is the security or commodity upon which derivatives, options, and convertibles are based. Changes in the price of an underlying asset directly influence the value of related derivatives. Underlying assets include equities, commodities, interest rates, indices, real estate, and cryptocurrencies. Derivatives based on underlying assets can increase market liquidity but also introduce speculation risks.

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UAE’s treasury sukuk auction hits $2.13bn: Finance Ministry

2 years ago|

By Rafiq A. Tschannen, Akhilesh Ganti |The Muslim Times

An oversubscription rate of 7.1 times was announced, according to the UAE news agency WAM. Shutterstock ARAB NEWS March 26, 202416:26 RIYADH: The UAE’s treasury sukuk auction received bids totaling 7.83 billion dirhams ($2.13 billion), signaling a promising trajectory for the country’s financial landscape.

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Understanding Upside: Boost Your Investment Potential With Key Strategies

3 years ago|

By Akhilesh Ganti, Vikki Velasquez |Investopedia Verified

Key Takeaways Upside refers to the potential increase in value of an investment, portfolio, company, or market. Analysts use technical and fundamental analysis to predict the potential upside of investments by examining price trends and financial health. High upside potential often correlates with higher risk, following the high-risk/high-reward principle. Factors affecting upside include market trends, economic indicators, and strategic business moves.

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Zero-Coupon Inflation Swaps: How They Work, Key Benefits, and Examples

3 years ago|

By Akhilesh Ganti, Suzanne Kvilhaug, Gordon Scott |Investopedia Verified

Key Takeaways A zero-coupon inflation swap (ZCIS) is a derivative exchanging a fixed-rate payment for an inflation-linked payment, settled as a lump sum at maturity. ZCIS contracts allow investors to hedge against inflation, benefiting if actual inflation exceeds the breakeven rate. The swap's value depends on the difference between expected and actual inflation rates, measured by an inflation index.

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How the Fed Reduces Market Liquidity

4 years ago|

By Akhilesh Ganti |Investopedia Verified

Key Takeaways Quantitative tightening (QT) reduces the Federal Reserve's balance sheet by removing liquidity from financial markets through selling or maturing government bonds. QT aims to curb inflation by increasing interest rates, making borrowing costlier and reducing overall consumer demand. While QT helps combat an overheating economy, it risks destabilizing financial markets and could trigger a global economic crisis.

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Employee Stock Ownership Plan (ESOP): What It Is, How It Works, and Advantages

5 years ago|

By Akhilesh Ganti, Vikki Velasquez, Samantha Silberstein |Investopedia Verified

Key Takeaways An employee stock ownership plan (ESOP) is an employee benefit that gives workers ownership interest in the company in the form of shares of stock. ESOPs encourage employees to give their all, tying the company’s success to financial rewards for the employees. They also help staff to feel more appreciated and better compensated for the work they do. Companies typically tie distributions from the plan to vesting, which gives employees rights to employer-provided assets over time.

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How the Glass Cliff Phenomenon Impacts Women in Leadership

6 years ago|

By Julia Kagan, Kirsten Schmitt, Akhilesh Ganti |Investopedia Verified

Key Takeaways "Glass cliff" refers to promoting women to precarious leadership roles during crises. Women in these roles often face harsher scrutiny and higher risk of blame for failures. Studies show minority leaders are often appointed to struggling companies, increasing their challenges. Companies may use glass cliffs to appear progressive while reinforcing harmful stereotypes. Mitigating glass cliff risks involves strategic networking, negotiation, and understanding company health.

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Global Markets Review: US Jobs Recovery Slowing Down

6 years ago|

By Akhilesh Ganti |Investopedia Verified

Pressure on Congress to provide more stimulus Overview U.S. indices advanced as headline employment data gave rise to optimism about economic recovery, although the details indicate that more stimulus is needed. Gold prices raced above $2,000/oz as bond yields remain near all-time lows.

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How OPEC (and Non-OPEC) Production Affects Oil Prices

6 years ago|

By Akhilesh Ganti |Investopedia Verified

Crude oil holds a prominent position in the global commodities market because oil price changes affect the global economy. Thus, those countries or groups that produce crude oil also impact economies worldwide. Oil prices are largely dependent on two factors: geopolitical developments and economic events. These two variables can lead to changes in oil demand and supply levels, which drives oil price fluctuations from one day to the next.

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Mastering Condor Spreads: A Strategic Guide for Non-Directional Traders

7 years ago|

By Akhilesh Ganti, Katrina Avila Munichiello, Gordon Scott |Investopedia Verified

Key Takeaways A condor spread is a non-directional options strategy that limits gains and losses while profiting from low or high volatility. There are two types: the long condor, which benefits from low volatility, and the short condor, which profits from high volatility. A condor spread involves four options with the same expiration date but different strike prices. Compared to butterfly spreads, condor spreads offer a wider maximum profit zone but with a lower profit potential.

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Challenges Uber Will Face Going Forward

7 years ago|

By Vanessa Page, Timothy Li, Akhilesh Ganti |Investopedia Verified

Key Takeaways Uber may be a ride-sharing leader, but it faces several challenges both in the U.S. and worldwide. The rise of autonomous vehicles creates many challenges, including the reliance on partners and new market entrants. Uber’s bottom line could face pressure if regulations change to give drivers more protections or if they’re reclassified as employees rather than independent contractors.

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What Is Real Gross Domestic Product (Real GDP)?

7 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is Real Gross Domestic Product (Real GDP)? Real gross domestic product (real GDP) is an inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a given year (expressed in base-year prices) and is often referred to as constant-price GDP, inflation-corrected GDP, or constant dollar GDP.

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McGinley Dynamic Indicator Definition

7 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is McGinley Dynamic Indicator? McGinley Dynamic indicator is a type of moving average that was designed to track the market better than the existing moving average indicators. It is a technical indicator that improves upon moving average lines by adjusting for shifts in market speed. John R. McGinley, a market technician, is the inventor of the eponymous indicator.

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What Are Degrees of Freedom in Statistics?

7 years ago|

By Akhilesh Ganti |Investopedia Verified

Key Takeaways What Are Degrees of Freedom? Degrees of freedom allow data points in a sample to be randomly selected except for the final value. Degrees of freedom equals the number of units within a given set minus 1, such as n-1, where n is the sample size. The sample size does not matter as long as the last data point in the sample remains constant.

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Understanding the Nepalese Rupee (NPR): History and Usage

7 years ago|

By Jason Fernando, Akhilesh Ganti |Investopedia Verified

Key Takeaways The Nepalese rupee (NPR) has been Nepal's currency since 1932, succeeding the Nepalese mohar. The NPR is pegged to the Indian rupee (INR) at 1.6 NPR to 1 INR. NPR transactions can be complicated due to multiple exchange rates, including a black market rate. The NPR is available in various coin and banknote denominations, including paisa and rupees. Nepal's economy has grown significantly, with recent GDP growth rates over 4%.

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Forex Market Explained: History, Mechanics, Pros & Cons

7 years ago|

By Akhilesh Ganti, Gordon Scott, Vikki Velasquez |Investopedia Verified

Key Takeaways The foreign exchange market is the largest financial market in the world, operating 24 hours a day across a global network of financial centers, making it highly liquid and accessible for international trade and investments. Forex markets are comprised of a diverse array of participants, including banks, commercial companies, central banks, hedge funds, and individual investors, each engaging in buying, selling, exchanging, and speculating on currency pairs.

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Swiss National Bank Definition

7 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is the Swiss National Bank? The Swiss National Bank (SNB) is the central bank of Switzerland and is responsible for setting that country's monetary policy and issuing its currency, the Swiss franc (CHF). Key Takeaways The Swiss National Bank (SNB) is the central bank of Switzerland and is responsible for setting that country's monetary policy and issuing its currency, the Swiss franc (CHF).

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Escrow Receipt Definition

7 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is an Escrow Receipt? An escrow receipt is a bank statement which guarantees that an option writer has the underlying security available for delivery, should the need arise. Key Takeaways An escrow receipt is a bank statement which guarantees that an option writer has the underlying security available for delivery, should the need arise. An escrow receipt is most often utilized when a client's options account is held at a bank, rather than a registered broker-dealer.

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Optionable Stock Definition

7 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is an Optionable Stock? An optionable stock is one where the stock has the necessary liquidity such that a market maker, like a bank or an accredited financial institution, lists that stock's options for trading. Key Takeaways An optionable stock is one where the stock has the necessary liquidity such that a market maker, like a bank or an accredited financial institution, lists that stock's options for trading.

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A Guide to Becoming a Seasoned Investor

7 years ago|

By Christine DiGangi, Akhilesh Ganti |The Balance

Part of By Christine DiGangi Updated March 29, 2022 Reviewed by Akhilesh Ganti From the conservative saver to the aggressive risk-taker, most people agree that a smart, long-term financial plan needs ways to make money grow. Like most financial choices, there's no single best way to do that. If you want to become a seasoned investor, you must learn to get to know yourself, including your goals, motivations, fears, and limits.

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How Does Fortnite Make Money: Online Gaming, eSports

8 years ago|

By Akhilesh Ganti |Investopedia Verified

On July 27, 2019, Fortnite celebrated its second birthday by hosting a huge extravaganza, fittingly dubbed as its first World Cup, and gave away millions of dollars in prizes (over $30 million by some accounts). Kyle 'Bugha' Giersdorf, a 16-year-old from Pottsgrove, PA won $3 million and the bragging rights of becoming Fortnite's first World Cup champion.

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Buyer's Market Explained: Key Features and Real Estate Impact

8 years ago|

By Akhilesh Ganti, Michael Logan, Eric P. Estevez |Investopedia Verified

Key Takeaways A buyer's market occurs when supply exceeds demand, giving buyers an advantage in price negotiations. In a buyer's market, sellers may need to lower prices to attract buyers. Economic factors like increased supply or decreased demand contribute to the creation of a buyer's market. Buyer's markets often involve longer selling times and more price competition among sellers.

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Open Trade Equity Explained: Definition, Uses, and Key Examples

8 years ago|

By Akhilesh Ganti, Somer Anderson, Yarilet Perez |Investopedia Verified

Key Takeaways Open Trade Equity (OTE) measures unrealized gains or losses on open derivatives positions before they are closed. OTE is crucial for margin investors, affecting available equity and margin requirements. A positive OTE suggests potential profits, while a negative OTE indicates possible losses. Margin calls may occur if OTE drops the account balance below the maintenance margin. Regularly monitoring OTE helps traders manage risks and respond to market fluctuations.

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Free Lunch

8 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is a Free Lunch? A free lunch refers to a situation where there is no cost incurred by the individual receiving the goods or services being provided. In the world of investing, free lunch usually refers to riskless profit, which has been proven to be unattainable for an extended period of time. Key Takeaways A free lunch describes a situation where an individual receives goods or services at no cost. A free lunch's cost is opportunity cost.

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Understanding Sawbuck: Definition, Origin, and Usage in Forex

8 years ago|

By Akhilesh Ganti, Thomas J. Catalano |Investopedia Verified

Key Takeaways A sawbuck is an X-shaped wooden rack used for cutting timber. It became a slang term for a $10 bill because of the Roman number X (10). Historically, the design of the $10 bill featured Roman numeral Xs until 1880 when they were replaced with other elements. In modern forex markets, a "sawbuck" can refer to a $10 million transaction. The etymology of the word "buck" for money is associated with trading deer hides in the 18th century.

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Understanding Ticks in Trading: Meaning and Market Effects

8 years ago|

By James Chen, Suzanne Kvilhaug, Akhilesh Ganti |Investopedia Verified

Key Takeaways A tick measures the smallest price movement of a security on its exchange, with tick sizes differing between markets. Since 2001, stocks that trade over $1 have a minimum tick size of one cent due to SEC-mandated decimalization. The SEC's 2016 Tick Size Pilot Program showed that larger tick sizes led to higher trading costs and less activity.

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What Is Rational Choice Theory?

8 years ago|

By Akhilesh Ganti |Investopedia Verified

Key Takeaways What Is Rational Choice Theory? Rational choice theory states that individuals seek to achieve outcomes aligned with their objectives to maximize their self-interest. When limited options are available, individuals choose the path that provides the greatest benefit and satisfaction. Self-Interest and the Invisible Hand Adam Smith was one of the first economists to develop the underlying principles of rational choice theory.

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Types, Examples, and Business Impact

8 years ago|

By Akhilesh Ganti |Investopedia Verified

Key Takeaways What Is Corporate Social Responsibility (CSR)? Corporate social responsibility involves ethically-focused business practices that can affect societal and environmental well-being in positive ways. Growing numbers of investors and consumers seek to invest their money in companies concerned not just with increasing shareholder value but with ethical and sustainable business choices, as well.

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Definition and the Impact on Demand

8 years ago|

By Akhilesh Ganti |Investopedia Verified

Key Takeaways What Is Total Utility? Total utility is the full amount of satisfaction a consumer feels when they consume a product or service. Put simply, it is the total happiness that consumers derive from goods and services. Total utility is often compared to marginal utility, which is the satisfaction a consumer receives from consuming one additional unit of a good or service. Total utility helps economists understand the demand for goods and services.

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Understanding Capital Market Line (CML) and How to Calculate It

8 years ago|

By Akhilesh Ganti |Investopedia Verified

Key Takeaways What Is the Capital Market Line (CML)? The capital market line (CML) is a theoretical construct that depicts portfolios achieving the most efficient trade-off between risk and return. It reflects all possible blends of a no-risk investment and a diversified basket of market-based assets that yield the highest expected return for a given level of risk.

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What Are Metropolitan Statistical Areas and Their Economic Impact?

8 years ago|

By Akhilesh Ganti, Vikki Velasquez, Charles Potters |Investopedia Verified

Key Takeaways MSAs include a core city and surrounding regions with strong social and economic links. The U.S. and Puerto Rico have 393 designated MSAs as of July 2024. MSAs help analyze labor markets, income trends, and economic growth. Real estate investors use MSA data for assessing housing trends. MSAs require a city with at least 50,000 people, unlike micropolitan areas. Get personalized, AI-powered answers built on 27+ years of trusted expertise. What Is a Metropolitan Statistical Area (MSA)?

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Distribution Waterfalls in Private Equity: A Comprehensive Guide

8 years ago|

By Akhilesh Ganti, JeFreda Brown, Ryan Eichler |Investopedia Verified

Reviewed by JeFreda R. Brown Fact checked by Ryan Eichler Investopedia / NoNo Flores Definition A distribution waterfall is a structured for allocating investment returns among private equity fund investors based on a set hierarchy, which can differ between countries. Key Takeaways Distribution waterfalls prioritize how investment returns are allocated in private equity funds, often favoring general partners.

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Trading Curb Definition

8 years ago|

By Akhilesh Ganti |Investopedia Verified

What is a Trading Curb? A trading curb, also called "circuit breaker," is the temporary halting of trading so that excess volatility can be reined in and order restored. Key Takeaways Governed by Securities and Exchange Commission's (SEC) Rule 80B, a trading curb is a temporary restriction on trading in a particular security or market, with the stated goal being to reduce excess volatility so that order can be restored. Trading curbs were first implemented after the stock market crash on Oct.

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Understanding Time and Sales for Advanced Trading Strategies

8 years ago|

By Lucas Downey, Akhilesh Ganti, Yarilet Perez |Investopedia Verified

Key Takeaways Time and sales (T&S) data offers real-time details on executed trades, including price, volume, direction, and time. This data is crucial for traders to analyze market activities and refine technical trading strategies. Most trading platforms provide customizable time and sales displays, allowing filters for price or volume. T&S data can signal market changes through patterns like volume spikes or price shifts.

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Preference Equity Redemption Cumulative Stock (PERCS) Definition

8 years ago|

By Akhilesh Ganti |Investopedia Verified

What is Preference Equity Redemption Cumulative Stock? Preference Equity Redemption Cumulative Stock (PERCS) is an equity derivative that is classified as a hybrid security and automatically converts to equity at its pre-determined maturity date. Key Takeaways Preference Equity Redemption Cumulative Stock (PERCS) is an equity derivative that is classified as a hybrid security and automatically converts to equity at its pre-determined maturity date.

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Asian Tail Definition

8 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is an Asian Tail? An Asian tail is a feature whereby an Asian option's averaging feature is only active for a part, usually the last ten to twenty days, of that option's life. Key Takeaways An Asian tail is a feature whereby an Asian option's averaging feature is only active for a part, usually the last ten to twenty days, of that option's life.

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Cash-and-Carry Trade Definition

8 years ago|

By Akhilesh Ganti |Investopedia Verified

What Is a Cash-and-Carry Trade? A cash-and-carry trade is an arbitrage strategy that exploits the mispricing between the underlying asset and its corresponding derivative. The key to profiting from this strategy is the eventual correction in that mispricing. A cash-and-carry trade should not be confused with a carry trade in the context of forex trading; such a carry trade looks for interest rate differentials between countries.

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Bear Spread

8 years ago|

By Akhilesh Ganti |Investopedia Verified

A bear spread is an option strategy that will profit when the price of the underlying security declines. The strategy involves the simultaneous purchase and sale of options, where either puts or calls can be used. A trader buying a put bear spread would purchase a put with a higher strike price while simultaneously selling a put with a lower strike price.

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Understanding Insurance Policy Lapses: Causes and Consequences

8 years ago|

By Adam Hayes, Akhilesh Ganti |Investopedia Verified

Key Takeaways A lapse occurs when a policy or contract becomes inactive due to unmet requirements like missed payments. Insurance lapses mean no coverage until the policy is reinstated. Auto insurance lapses can lead to fines and higher premiums. Policies often have a grace period to allow for payment before a lapse occurs. Stock options can lapse if they’re not exercised in time, leading to potential forfeiture of shares.

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Offset in Finance: Definition, Examples, and Applications Explained

8 years ago|

By James Chen, Katrina Avila Munichiello, Akhilesh Ganti |Investopedia Verified

Key Takeaways An offset involves taking a directly opposite position in financial markets to reduce risk or eliminate potential losses. Offsetting is commonly used in futures and options trading to avoid physical delivery of the underlying assets. In accounting, offsets nullify the effects of a recorded loss by balancing it with an equivalent gain. Businesses use offsets to balance losses in one unit with gains in another, thereby stabilizing overall profitability.

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Understanding the COT Report: Features, Types, and Usage Explained

8 years ago|

By Adam Hayes, Akhilesh Ganti, Yarilet Perez |Investopedia Verified

Key Takeaways The Commitments of Traders (COT) report is a weekly publication by the CFTC that displays aggregate futures market positions. It includes four reports: the Legacy, Supplemental, Disaggregated, and Traders in Financial Futures reports. Futures traders often use COT data to confirm market trends or reversals and refine their trading strategies. The COT report aims to enhance transparency but also shows the complexity and limitations of futures markets data categorization.

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