SCALE DOWN (OR UP)

To purchase on scale down means to buy at regular price intervals in a declining market. To sell on scale up means to sell at regular price intervals as the market advances.

SELL A CONTRACT

In reference to futures. Enter into a futures contract to sell a specified commodity.

SELLER'S MARKET

A condition of the market in which there is a scarcity of goods available and hence sellers can obtain better conditions for sale or higher prices.

SELLING HEDGE (OR SHORT HEDGE)

Selling futures contracts to protect against possible decreased prices of commodities. (See also hedging).

SETTLEMENT PRICE

The official closing price calculated at the end of each trading session. It is the mid point of closing bid and offer quotes.

SETTLEMENT DATE

The date on which the contract is settled.

SFE

Sydney Futures Exchange Limited.

SFECH

Sydney Futures Exchange Clearing House Pty Limited.

SHORT

(1) The sold side of an open futures contract.
(2) A trader whose net position in the futures market shows an excess of open sales over open purchases. (See long).

SHORT SELLING

Agreeing to sell a commodity not presently owned with the intention of buying at a later date.

SPAN®

Margining system for futures and options, known as Standard Portfolio Analysis of Risk®, was developed by the Chicago Mercantile Exchange and is the most widely adopted margining system in the global futures industry.

SPECULATOR

A person entering into futures contracts for any purpose other than hedging. One who attempts on the basis of existing conditions to anticipate price changes and to trade accordingly in order to make capital gains.

SPOT

Market for immediate delivery of the product and immediate payment. Also refers to the nearest delivery month on a futures contract.

SPOT COMMODITY

The actual commodity as distinguished from futures - same as ACTUALS or CASH COMMODITY.

SPOT MONTH

See current delivery month.

SPOT PRICE

The price quoted for the actual physical commodity - same as Cash Price.

SPREAD

Also known as spread, the purchase of one future month against the sale of another future month of the same commodity. A spread trade is based on a price relationship between the two months and a belief that the "spread" or difference in price between the two contract months will change sufficiently to make the trade profitable

SQUEEZE

Situation in which those who are short cannot repurchase their contracts, except at a price substantially higher than the value of these contracts in relation to the rest of the market.

STRADDLE

Also known as spread, the purchase of one future month against the sale of another future month of the same commodity. A straddle trade is based on a price relationship between the two months and a belief that the "spread" or difference in price between the two contract months will change sufficiently to make the trade profitable.

STRIKE PRICE

See exercise price.

SWITCH

Closing a position in one delivery month of a commodity and simultaneous initiation of a similar position in another contract month of the same commodity. When used by hedgers, this tactic is referred to as "rolling forward" the hedge.

SWITCHING

The simultaneous closing out of futures contracts in one delivery month while opening futures contracts in another delivery month in the same commodity and on the same Exchange. A position is thus transferred from one delivery month to another.

SYCOM

Sydney Computerised Market is an automated dealing system used by SFE.