Convergence

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Convergence

The movement of the price of a futures contract toward the price of the underlying cash commodity. At the start, the contract price is usually higher because of time value. But as the contract nears expiration, and time value decreases, the futures price and the cash price converge. More generally, convergence trading involves taking two related assets that have different prices with the expectation that prices will converge (the cheaper asset is purchased and the more expensive is sold short).

Convergence

The fact that the futures price and the spot price for a given asset approach one another as a futures contract on that asset approaches maturity. At maturity, the two prices should be equal. The existence of convergence is the basis for the theory that forward rates equal future spot rates, though this idea is more controversial.

convergence

The process by which the futures price and the cash price of an underlying asset approach one another as delivery date nears. The futures and cash prices should be equal on the delivery date.
References in periodicals archive ?
Refresh of laptops was not a cost included in the convergence cost because the Army would need to resource this requirement regardless of convergence.
In order to assess the sustainability of the convergence achieved, the "results of the integration of markets, the situation and development of the balance of payments on current account, and [.
The combination of expertise that Joe and Shayne possess enables the OSE to quickly grow and deliver valuable tools like the Convergence Roadmap(SM)" says Laurie Aaron, Vice Chairman of the OSE.
This unique report, the first of its kind provides a deep understanding of the status of convergence technology in India in terms of applications & technologies applicable for the convergence adoption such as VOIP, Video & Web conferencing in Industries, education, research activities, patents filed in the country, major industry forums, profiles of major R&D centers & Investments.
For identifying convergence service evolution trends and the most notable convergence services in Japan, the report defines the convergence service structure (Convergence Service Structure Definition), maps the structure with the existing convergence services and markets (Japanese Market Structure Analysis), and then analyzes the penetration level of the services as well as vectors behind the evolution of the services (Mini Values and Mini Forces).