Financial Dictionary

This dictionary contains:
24549
financial terms

Naked




Naked

An uncovered position such as the position of a writer of an option which is not covered by an opposite position in the underlying instrument.

RELATED TERMS
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Position
A market commitment; the number of contracts bought or sold for which no offsetting transaction has been entered into.

Writer
A person who makes an opening sale of an option contract.

Option
The right but not the obligation to buy or sell a fixed quantity of a commodity, currency or security at a fixed price on or until a particular date.

Covered
A written option is considered to be covered if the writer also has an opposing market position on a share-for-share basis in the underlying security.

Underlying
1) In derivatives, the security that must be delivered when a derivative contract, such as a put or call option, is exercised. 2) In equities, the common stock that must be delivered when a warrant is exercised, or when a convertible bond or convertible preferred share is converted to common stock.



SIMILAR TERMS
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Naked call
A call option position held by a writer who does not hold a long position in the stock on which the call has been written.

Naked option
An option position where the buyer or seller has no underlying security position.

Naked option strategies
An unhedged strategy making exclusive use of one of the following: short call strategy (selling or writing call options), and short put strategy (selling or writing put options).

Naked position
A securities position that is not hedged from market risk.

Naked put
A put option whose writer does not have a short position in the stock on which he or she has written the put.

Naked shorting
The illegal practice of short selling shares that have not been affirmatively determined to exist.

Naked strategies
Writing an option without owning the underlying asset. Holder is naked because holder may have agreed to sell something not owned.

Naked writer
Uncovered call writing and Uncovered put writing.



PREVIOUS AND NEXT TERMS
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Numide Inversiones, SICAV, S.A.
Numide Inversiones, SICAV, S.A. is a Spanish company listed at Madrid Stock Exchange. Its business activity is capital investment.

Nyati Inversiones, SICAV, S.A.
Nyati Inversiones, SICAV, S.A. is a Spanish company listed at Madrid Stock Exchange. Its business activity is capital investment.

Nagoya Stock Exchange
Established after World War II, one of the three major securities markets in Japan.

NAIRU or Non accelerating inflation rate of unemployment
Another name for the natural rate of unemployment.

Naive diversification
A strategy whereby an investor simply invests in a number of different assets in the hope that the variance of the expected return on the portfolio is lowered.

Naked

Naked call
A call option position held by a writer who does not hold a long position in the stock on which the call has been written.

Naked option
An option position where the buyer or seller has no underlying security position.

Naked option strategies
An unhedged strategy making exclusive use of one of the following: short call strategy (selling or writing call options), and short put strategy (selling or writing put options).

Naked position
A securities position that is not hedged from market risk.

Naked put
A put option whose writer does not have a short position in the stock on which he or she has written the put.

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This dictionary contains 24549 terms.







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