M&C Energy Group Glossary |
Find here terms and their explanations commonly used in Energy Industry, Finance and Trading Boards
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| There are 30 entries in the glossary. |
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| Fair Value | Theoretical value.
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| Fast Market | Transactions in the ring that take place in such volume and with such rapidity that price reporters are behind with price quotations, so they insert "Fast" and show a range of prices. |
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| Feasibility Study | A methodology for identifying where and how energy is used on a site within core processes and then making recommendations for reducing usage and or eliminating waste. |
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| Feedstock | The supply of crude oil, natural gas liquids, or natural gas to a refinery or petrochemical plant or the supply of some refined fraction of intermediate product to some other manufacturing process. |
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| Fence | A long (short) underlying position together with a long (short) out-of-the-money put and a short (long) out-of-the-money call. All options must expire at the same time. |
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| FIA | Futures Industry Association. A national not-for-profit futures industry trade association that represents the brokerage community on industry, regulatory, political, and educational issues. |
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| Fill | The price at which an order is executed. |
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| Fill or Kill | An order which must be filled immediately, and in its entirety. Failing this, the order will be canceled. |
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| Fine Weight | The weight of precious metal contained in a coin or bullion as determined by multiplying the gross weight by the fineness. |
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| Fineness | The purity of precious metal measured in parts per thousand. |
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| Firm Energy | The highest quality sales of electric transmission service offered to customers under a filed rate schedule that anticipates no planned interruption. |
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| Firm Gas | Gas supplied to a customer on a guaranteed basis, without interruption. |
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| Firm Service | Utility service which assumes no interruption except if residential customers' supply is threatened. Opposite of interruptible service. |
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| First Notice Day | The first day on which the clearinghouse notifies clearing members of delivery allocations. Energy contracts have only one notice day. Metals contracts have notice days just prior to the beginning and end of the delivery period. |
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| Fixed Charge | A monthly of quarterly charge levied by the supplier and is in addition to the standing charge. |
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| Floor | 1) The main trading area of an exchange. 2) A supply contract between a buyer and seller of a commodity, whereby the seller is assured that he will receive at least some minimum price. This type of contract is analogous to a put option. |
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| Floor Broker | An exchange member who executes orders to buy or sell futures and options in the trading ring on the floor of a commodities exchange. |
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| Floor Trader or Local | An exchange member who buys or sells futures and/or options for his own account. |
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| Force Majeure | A standard clause which indemnifies either or both parties to a transaction whenever events which the Exchange declares to be reasonably beyond the contract. |
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| Forward Contract | A supply contract between a buyer and seller, whereby the buyer is obligated to take delivery and the seller is obligated to provide delivery of a fixed amount of a commodity at a predetermined price on a specified future date. Payment in full is due at the time of, or following, delivery. This differs from a futures contract where settlement is made daily, resulting in partial payment over the life of the contract. |
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| Forwards Contract | An agreement to buy electricity from another party at a specified time in the future at a specified price with money changing hands at the delivery date.
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| Fossil Fuel | An energy source formed in the Earths crust from decayed organic material. The common fossil fuels are oil, coal, and natural gas. |
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| Fractionation | The process whereby saturated hydrocarbons from natural gas are separated into distinct parts or "fractions" such as propane, butane, ethane, etc. |
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| Free on Board (FOB) | A transaction in which the seller provides a commodity at an agreed unit price, at a specified loading point within a specified period; it is the responsibility of the buyer to arrange for transportation and insurance. |
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| Fuel Oil | Refined petroleum products used as a fuel for home heating and industrial and utility boilers. Fuel oil is divided into two broad categories, distillate fuel oil, also known as No. 2 fuel, gasoil, or diesel fuel; and residual fuel oil, also known as No. 6 fuel, or outside the United States, just as fuel oil. No. 2 fuel is a light oil used for home heating, in compression ignition engines, and in light industrial applications. No. 6 oil is a heavy fuel used in large commercial, industrial, and electric utility boilers. |
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| Fundamental Analysis | The study of pertinent supply and demand factors which influence the specific price behavior of commodities. See also Technical Analysis. |
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| Fungible | Interchangeable. Products which can be substituted for purposes of shipment or storage. |
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| Futures Commission Merchant | An FCM is the only industry participant who receives, handles, and manages customer funds, margin payments, and commission charges. He is also responsible for confirmation of trade slips, customer statements, and guarantees. |
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| Futures Contract | Similar to a forwards contract these are normally trade through an exchange on standard contract terms with profits or losses calculated and paid daily. |
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| Futures-Equivalent | A term frequently used with reference to speculative position limits for options on futures contracts. The futures-equivalent of an options position is the number of options multiplied by the previous day's risk factor or delta for the options series. For example, 10 deep out-of-the money options with a risk factor of 0.20 would be considered two futures-equivalent contracts. The delta or risk factors used for this purpose is the same as that used in delta-based margining and risk analysis systems. |
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Glossary V2.0 |
