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What is an Open Position - Open Position Definition

2018-05-31 12:19    forextraders

Open Position Definition. An Open Position describes the status of an account that has existing active trades with specific obligations thereto that have not been offset by corresponding trades of an equal and opposite deal amount. In the futures market, it can mean the total number of futures contracts entered into a specific trading period or delivery month that have not been liquidated or covered by a futures transaction of the opposite type or by the actual physical delivery of the commodity or currency. An Open Position is also referred to as Open Interest. The offsetting transaction is necessary to shield the trader from the effects of a future change in price of the commodity or currency.

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