| Last intent day |
The final day on which notices of intent to deliver on futures contracts may be presented to the Clearing House. |
| Last inventory day |
The final day in which long firms need to report their long position via the CME Clearing deliveries system. |
| Last trading day |
The day on which trading ceases in a contract month. |
| Lead month |
The futures contract trading in lead month position on the trading floor or electronically; the most current contract month in which delivery may take place, closest to the current point in time. |
| Leg |
Each component transaction of a swap. |
| Leverage |
The use of a small quantity of assets to control a greater quantity of assets; for example, in futures, relatively little capital, usually 5% to 15% of the total value of the contract, gives the trader the benefit of price movement on the full contract. The downside is that if the price moves adversely, the leverage will work against the trader. |
| LIBOR |
London Inter-bank Offered Rate. The price at which short term deposits are traded among major banks in London. |
| Limit |
A contract's maximum price advance or decline from the previous day's settlement price permitted in one trading session, as determined by the exchange. See Price Limit. |
| Limit move |
A price that has advanced or declined the limit permitted during one trading session for a contract, as fixed by the rules of the Exchange. See also PRICE LIMIT. |
| Limit order |
An order in which the customer specifies a minimum sale price or maximum purchase price, as contrasted with a market order, which implies that the order should be filled as soon as possible at the market price. |
| Limit order - GLOBEX and Open Outcry |
Usually equivalent to "price." An order in which the customer sets a limit on price or other condition, as contrasted with the trading floor definition of a market order, which implies that the order should be filled as soon as possible. |
| Liquidate |
To offset an existing position. |
| Liquidation |
A condition that describes the depth of market orders. A liquid market is able to accept large orders to buy or sell a commodity, with little change to the current price; ease of entry into, and exit from, the market. |
| Liquidity |
A condition that describes the depth of market orders. A liquid market is able to accept large orders to buy or sell a commodity, with little change to the current price; ease of entry into, and exit from, the market. |
| Livestock cycle |
A long, repeating pattern of increasing and decreasing livestock supply and prices. |
| Locals |
Exchange members who trade for their own accounts and/or fill orders for customers. |
| London Inter-bank Offered Rate (LIBOR) |
The price at which short term deposits are traded among major banks in London.Basically, the interest rate that banks charge each other for loans (usually in Eurodollars). The LIBOR is officially fixed once a day by a small group of large London banks, but the rate changes throughout the day. |
| Long |
One who has bought a futures or options on futures contract to establish a market position and who has not yet closed out this position through an offsetting procedure. The opposite of Short. Also, a market position that obligates the holder to take delivery if the position is not offset previous to delivery date. |
| Long cash |
To own and plan to sell a commodity. |
| Long hedge |
The purchase of a futures contract in anticipation of an actual purchase in the cash commodity market. Used by processors or exporters as protection against an advance in the cash price. See hedge. |
| Long position |
A market position in which the trader has bought a futures contract or options on futures contract that does not offset a previously established short position. |
| Long the basis |
Position where a hedger is long the cash market and short in the futures market. |
| Lot |
A unit of trading (used to describe a designated number of contracts). For example, a trade quantity of one equals a "one lot;" a trade quantity of four equals a "four lot." Also called cars. |