CONTRACT FOR DIFFERENCE (CFD) is an agreement to exchange the difference between the opening and closing price of the position under the contract on various financial instruments. CFD trading is an effective and convenient speculative instrument for trading shares, indices, futures and commodities. Contract for difference trading allows investors to take long or short positions, and unlike futures contracts have no fixed expiry date or contract size. Trades are conducted on a leveraged basis with margins typically ranging from 1% to 30% of the notional value for CFDs on leading equities.
RED HERRING is a preliminary registration statement describing the issue (the IPO) and prospects of the company that must be filed with the SEC or provincial securities commission. There is no price or issue size stated in the red herring. Red Herrings are sometimes updated several times before it is called the final prospectus. It is known as a red herring because it contains a statement typed in red that the company is not attempting to sell their shares before the registration is approved by the SEC.
REGULAR SETTLEMENT is 1) For short-term or U.S. Treasury securities, the settlement, or payment and delivery, is the next business day after the trade date. 2) For corporate notes, bonds and municipal securities, settlement is in five business days. 3) For mortgage-backed securities, settlement is after the 15th of the month. 4) For Eurodollar Certificates of Deposit, settlement is two business days after the trade date. Also known as "Regular Way.'
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