Interest Rate Futures Contracts 4 Finance Articles | August 17 Wholesale Stan Musial Jersey , 2010 The margin on a eurodollars contract is just around $1,000. Because the contract size is $1,000,000, this represents 11,000 Wholesale Ozzie Smith Jersey , or a tenth of one percent. This is amazingly small. Eurodollar contracts e...
The margin on a eurodollars contract is just around $1,000. Because the contract size is $1,000,000, this represents 11,000 Cheap Keith Hernandez Jersey , or a tenth of one percent. This is amazingly small.
Eurodollar contracts expires in March, June, September and December. It's quoted in decimals, making it easier to read and understand. Usually it's five digits, with the final one on the right representing a fraction of a point. It may look like 98.550.
Prices for eurodollars contracts varies with inflation rates, Federal Reserve policies Cheap Orlando Cepeda Jersey , various political and economic events and policies.
They are quoted in terms of 100 - the yield of official British Bankers Association fixing of the 3-month LIBOR US dollar rate as of the settlement date.
In the financial crisis in the fall of 2008, eurodollars benefited from the flight to quality. When all financial instruments seemed to be at risk, people wanted their money in US dollars. That meant a huge demand in eurodollar securities, forcing the futures contracts higher.
The contracts are settled by cash. This is because it's not possible to transfer time deposits from one bank to another.
The CME Group also offers eurodollar bundles. These allow traders and hedgers to buy and sell a consecutive series of contracts for a run of months in proportionate amounts.