Definition
The term closing range refers to the high and low price at which trades occurred at the close of the exchange. The closing range would include both bid and offer prices.
Explanation
The high and low price at which a security trades just before a market closes is referred to as its closing range. The same holds true for the futures market, where the minimum and maximum prices at which a contract trades constitute its range. This would typically include the bid, or price at which a trader would buy a security. It would also include the offer, or price at which a trader would sell a security.
Given the above, the closing range, or spread, for a security would be relatively narrow. The hours during which an exchange is open will vary by geographic region. The New York Stock Exchange as well as the NASDAQ are open from 9:30 a.m. Eastern Time and close at 4:00 p.m. Eastern Time.
Related Terms
The term differential refers to the allowed flexibility to change the quality of the underlying asset in a futures contract. Differential allows the seller in a futures contract to deliver the underlying asset which adheres to a predetermined range of quality specifications.
Moneyzine EditorNovember 6th, 2024
The term devaluation refers to the reduction in the value of a currency relative to the currency of another country. Devaluation typically occurs through an official announcement and the process is a tool governments can use to control monetary policy.Moneyzine EditorNovember 6th, 2024
The term deliverable grade refers to the minimum quality of a commodity delivered under a futures contract. The specifications for deliverable grades are critical to the pricing of a contract.Moneyzine EditorNovember 6th, 2024
The term default refers to the failure to meet an obligation on a loan or futures contract. Default occurs when a debtor fails to repay the interest and / or principal owed a lender.Moneyzine EditorNovember 6th, 2024
The term daily trading limit refers to the maximum range a derivative contract is permitted to trade in any one daily session. Daily trading limits are established by the exchange to protect against market manipulation.Moneyzine EditorNovember 6th, 2024
The term currency risk refers to the relative change in the valuation of two currencies and the impact it has on return on investment. Both investors as well as businesses that own assets in countries with different currencies are exposed to currency risk.Moneyzine EditorNovember 6th, 2024
The term credit derivative refers to an agreement that moves credit risk from one party to the other. Credit derivatives were originally used by participants in the banking industry to diversify the credit risk of customers in their lending portfolio.Moneyzine EditorNovember 6th, 2024
