Trigger Deals

Futures-related or derivative instrument which allows a marketer to lock into a price relationship, but gives him the opportunity to set the absolute price at a later date. A supplier might sell a trigger deal to a heating oil marketer whereby the marketer is guaranteed product at 2cts/gal over the Dec. futures price for No. 2 oil. The marketer has until an agreed upon date to pull the trigger to set the absolute value of the transaction.


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