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Friday's Term
Artificial Price
Definition:
A futures price that has been affected by a manipulation and is thus higher or lower than it would have been if it reflected the forces of supply and demand.
Arbitrage
Definition:
A strategy involving the simultaneous purchase and sale of identical or equivalent commodity futures contracts or other instruments across two or more markets in order to benefit from a discrepancy in their price relationship. In a theoretical efficient market, there is a lack of opportunity for profitable arbitrage. See Spread.
Basis Grade
Definition:
The grade of a commodity used as the standard or par grade of a futures contract.
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