Cash Closeout

From Open Risk Manual

Definition

Cash Closeout. Closeout of the contract in the form of the cash equivalent of the asset or commodity rather than the underlying asset or commodity itself.


Issues and Challenges

Various SME REview notes from OTC sessions: This is where you go into the market and buy the offsetting contract. Exchange Traded: Standard process for exchange traded: if you have an open contract you close out the contract by taking the reverse contract, then present those contracts to the clearing house to be closed out. What clearing house? What is the relationship between the two partie sand the clearing house. That's for futures. What about OTC? Does this exist? Closeout does exist for OTC. For OTC. Terms of contract are that they are cash settled. Except maybe gold.

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This entry annotates a FIBO Ontology Class. FIBO is a trademark and the FIBO Ontology is copyright of the EDM Council, released under the MIT Open Source License. There is no guarantee that the content of this page will remain aligned with, or correctly interprets, the concepts covered by the FIBO ontology.

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