Simple Moving Average (SMA)
What is Simple Moving Average (SMA)? Simple Moving Average (SMA) refers to a stock’s average closing price over a specified period. The reason the average is called “moving” is that the stock price constantly changes, so the moving average changes accordingly. SMA is one of the core indicators in technical analysis and is usually the...
Vanishing Premium Policy
What is a Vanishing Premium Policy? A vanishing premium policy is a type of permanent life insurance policy wherein a consumer can opt to utilize the dividends accruing from such a policy to pay its premium. After a given period of time, the cash value of the policy increases to a level where the sum...
Variance Swap
What is a Variance Swap? Variance swap refers to an over-the-counter financial derivative that allows the holder to speculate on the future volatility of a given underlying asset. Holders use variance swaps to hedge their exposure to the magnitude of possible price movements of underliers, such as exchange rates, interest rates, or an equity index....
Variation Margin
What is Variation Margin? The term variation margin refers to a margin payment made by a clearing member to a clearinghouse based on the price movements of futures contracts held by the clearinghouse members. Clearing members are required to pay variation margins on a day-to-day or an intraday basis in order to reduce the risk...
Basic Materials Sector
What is the Basic Materials Sector? The basic materials sector is made up of companies involved in the discovery, extraction, and processing of raw materials. It includes mining, forestry, and chemical production. Understanding Basic Materials Companies All physical goods are made up of a combination of basic materials processed to create a finished good. Basic...
