unwind

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Unwind

1. See: Close a position.

2. To correct a mistake. For example, if an investor instructs his/her broker to sell a security and the broker instead buys it, the broker must re-sell the security, and pay the client what he/she may have lost in the mistake. This process is known as unwinding.

unwind

1. To close out a relatively complicated investment position. For example, an investor who practices arbitrage by taking one position in stocks and the opposite position in option contracts would have to unwind by the date on which the options would expire.
2. To rectify a transaction in which a mistake has been made. For example, because of a misunderstanding, a brokerage firm may have bought the wrong stock for a customer. The firm must then unwind the erroneous trade by selling the stock just purchased and buying the correct stock.
References in periodicals archive ?
He said: "Our advice is if you're using a cable drum make sure it's unwound -especially with Christmas coming.
To be sure, investors wiped out in a fire sale will clearly be less risk prone than if their mistakes were unwound in a more orderly fashion.
When the yarn is being unwound from a cylindrical package, the angular velocity of the yarn forming the balloon depends on three parameters: the package radius, the unwinding velocity, and the winding angle.
The yarn in the layer which is being unwound has a winding angle [phi] (Figures 2 and 3).
Under this arrangement, CHIPS participants can be assured that the system would settle in the event of the failure of a large participant and that individual transactions processed through the system would not have to be unwound. Other payment or clearing systems have similar netting and settlement arrangements.
Indeed, the WSJ had an extensive report that the Fed is debating just how fast to unwind it and what composition to leave in place once it's unwound -- whether more T-bills left (more flexibility) or more longer Treasuries (keeps long yields down).
When the yam is being unwound from a cylindrical package, the angular velocity of the yam forming the balloon depends on three parameters: the package radius, the unwinding velocity, and the winding angle.
They allow construction of packages that can be unwound at higher unwinding speeds.