Basket (finance)

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Template:Use American English Template:Short description Template:Use mdy dates Script error: No such module "Unsubst". In finance, a basket is a weighted group (a linear combination) of several financial instruments.[1] The purpose could be, for example, simultaneous buying or selling, for example, during program trading.

Baskets can be traded by buying the shares separately or through a professionally negotiated transaction through a broker. People trade in baskets to arbitrage with the futures traded on the index. Baskets are also used to denote a collection of currencies, such as the ECU in the past.

Certain specific specialized "baskets":

  • A stock market index is a basket for all the securities in a particular exchange.
  • A market basket is a basket for all the securities on a particular market.
  • A combination of individual assets, used as an underlying of a basket option.

See also

References

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