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Daily Limit
The maximum futures contract price advance or
decline from the previous day’s settlement price permitted
during one trading session, as fixed by the rules of
the Exchange.
Day Trade
The purchase and sale of a futures or an options
contract on the same day.
Delivered
Often regarded as synonymous with cost, insurance,
and freight in the international cargo trade, its
terms differ from the latter in a number of ways.
Generally, the seller’s risks are greater in a delivered
transaction because the buyer pays on the basis of
landed quality/quantity. Risk and title are borne by the
seller until such time as the commodity, such as oil,
passes from shipboard into the connecting flange of the
buyer’s shore installation. The seller is responsible for
clearance through customs and payment of all duties.
Any in-transit contamination or loss of cargo is the
seller’s liability. In delivered transactions, the buyer pays
only for the quantity of oil actually received in storage.
Delivery
Delivery generally refers to the change of ownership
or control of a commodity under specific terms and
procedures established by the Exchange upon which the
contract is traded. Typically, except for energy, the commodity
must be placed in an approved warehouse,
depository, or other storage facility, and be inspected by
approved personnel, after which the facility issues a
warehouse receipt, shipping certificate, demand certificate,
or due bill, which becomes a transferable delivery
instrument. Delivery of the instrument usually is preceded
by a notice of intention to deliver.
Delivery Month
The month specified in a given futures contract for
delivery of the actual physical spot or cash commodity.
Delivery Notice
A notice presented through an exchange’s clearinghouse
by a clearing member announcing the intention
to deliver the actual commodity in satisfaction of a contract
obligation. See delivery.
Delivery Point(s)
Location(s) designated by an exchange at which
delivery may be made in fulfillment of contract terms.
Delta
The sensitivity of an option’s value to a change in
the price of the underlying futures contract, also referred
to as an option’s futures-equivalent position. Deltas are
positive for calls, and negative for puts. Deltas of deep
in-the-money options are approximately equal to one;
deltas of at-the-money options are 0.5; and deltas of
deep out-of-the-money options approach zero.
Delta Neutral Spread
A spread where the total delta position on the
long side and the total delta on the short side add up to
approximately zero.
Derivative
Financial instrument derived from a cash market
commodity, futures contract, or other financial instrument.
Derivatives can be traded on regulated exchange
markets or over-the-counter. For example, futures contracts
are derivatives of physical commodities, options
on futures are derivatives of futures contracts.
Differentials
Price differences between classes, grades, and
locations of different stocks of the same commodity.
Dirty Cargo
Those petroleum products which leave significant
amounts of residue in tanks. Generally applies to crude
oil and residual fuel oil.
DIFC
Dubai International Financial Centre
Discount
1) A downward adjustment in price allowed for
delivery of stocks of a commodity of lesser than contract
grade against a futures contract.
2) Sometimes used to
refer to the price differences between futures of different
delivery months.
Discretionary Account
An arrangement by which the holder of an
account gives written power of attorney to someone else,
often a broker, to buy and sell without prior approval of
the account holder. Often referred to as a "managed
account."
Distillate Fuel Oil
Products of refinery distillation sometimes referred
to as middle distillates; kerosene, diesel fuel, and home
heating oil.
Doctor Test
A qualitative method of detecting undesirable sulphur
compounds in petroleum distillates; that is, determining
whether an oil is sour or sweet.
Double Bottoms
A chart pattern of the price movement of a commodity
that shows resistance to a falling market; the
inverse of double tops. The price patterns are used by
technical analysts to recognize a reversal of a price trend.
Double Tops
A chart pattern of commodity price movements
that depict a rising market which hits resistance at a certain
level, retreats, rises again, but still cannot breach the
previous resistance point, and falls back again. The price
patterns are used by technical analysts to recognize a
reversal of a price trend.
Downstream
An industry term referring to commercial oil and
gas operations beyond the production phase; oil refining
and marketing, and natural gas transmission and distribution.
Dubai Financial Services Authority
The integrated regulator of all financial and ancillary services undertaken in or from the Dubai International Financial Centre.
Dubai International Financial Centre
A 110-acre financial free zone, in the centre of Dubai, which aims to to create an environment for progress and economic development in the UAE and the wider region.
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