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Elimination of a long or short position by making an opposite transaction. Related: Liquidation.


To change from a long position to a short position or from a short position to a long position. A long position is ownership of a security, while a short position is debt. Thus, to offset a long position is to sell a security, and to close a short position is to buy out the debt.


The liquidation of a futures or option position by purchasing (for a short position) or selling (for a long position) an equal number of identical contracts so that no further obligation exists.


You offset an options or futures position by taking a second position in a contract with identical terms, buying if you sold initially or selling if you bought initially.

With the offset, you neutralize any potential obligation you had to fulfill the terms of the contract, and you may make a profit or reduce a loss with the transaction.

For example, if you'd sold an equity call option that is close to being in-the-money, you might buy an offsetting call option. That neutralizes your obligation to deliver the underlying stock if the option you sold is exercised.

In a tax context, you can use capital losses to offset an equivalent dollar amount of capital gains, or up to $3,000 in capital losses to offset ordinary income. In either case, the offset allows you to reduce the tax you owe.

Further, banks have the right of offset if a borrower defaults on a loan. That right allows a bank to seize assets in the borrower's deposit accounts with the bank to reduce or eliminate any loss on the loan.

References in periodicals archive ?
David Hollingworth, of brokers London & Country Mortgages, said: "Choosing an off-set mortgage effectively means you are overpaying each month.
Adjusting for the US$35 million off-balance sheet liability, total adjusted debt/EBITDAR at the end of 2006 should remain approximately flat from 2005 as incremental debt is off-set by an expected increase in EBITDAR.
Vortex EZ and Vortex EZ MAX expand the RITA Medical Systems Vortex product family, and are part of the only port system in the industry to use the Company's patented rounded chamber design and off-set stem clinically proven to promote more efficient infusion and aspiration flow dynamics resulting in fewer patient complications.
One of the first off-set printers in Philadelphia, they have vast experience in pre-press, press and finishing techniques.
Place another sheet on top, but off-set roughly 6cm to the right, and brush with a little more oil.
While this will more than off-set a 4% cut in direct payments over 2,000 euros, it was still "disappointing" after a difficult 12 months for farmers, said NFU Cymru president Ed Bailey.
This leaves a handy pounds 400,000 to off-set the pounds 500,000 cost of the temporary facilities at Pier Head to handle customs and baggage check-in over the next three years.
Custom Spine's Auxiliary Connector system features an off-set rod-to-rod connector and s-rod, which allows the extension of a construct that has a 5.
Using the rights of off-set, lenders transfer funds from their current account to pay off the arrears without warning The result is spiralling debt problems and poverty, with victims struggling to meet mortgage payments and even buy food.
WARRANTY provider Warranty Direct has launched a so-called Green Warranty to support motorists of low CO2 emitting vehicles and those looking to off-set their carbon footprint.
WARRANTY provider Warranty Direct has launched a so-called Green Warranty to support motorists of low CO2-emitting vehicles and those looking to off-set their carbon footprint.
If you want to go down that road, I recommend you buy off-set from CarbonNeutral Newcastle, who provide off-set by insulating homes of people in our region who would struggle to pay for it themselves.