For example, one S&P 500 Index futures contract obligates the buyer to 250 units of the S&P 500 Index. If the index is trading at $1,000, then the single futures contract is similar to investing $250,000 (250 x $1,000). Therefore, $250,000 is the notional value underlying the futures contract.
Investment dictionary. Academic. 2012.
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notional value — The underlying value ( face value), normally expressed in U.S. dollars, of the financial instrument or commodity specified in a futures or options on futures contract. Chicago Mercantile Exchange Glossary … Financial and business terms
notional — no‧tion‧al [ˈnəʊʆnəl ǁ ˈnoʊ ] adjective a notional amount, price, rent etc is not real but is guessed at or used as an example: • an amount which had been based on the notional values of the homes which they occupied * * * notional UK US… … Financial and business terms
Notional amount — The notional amount (or notional principal amount or notional value) on a financial instrument is the nominal or face amount that is used to calculate payments made on that instrument. This amount generally does not change hands and is thus… … Wikipedia
notional — [[t]no͟ʊʃən(ə)l[/t]] ADJ Something that is notional exists only in theory or as a suggestion or idea, but not in reality. [FORMAL] ...the notional value of state assets. Syn: theoretical Derived words: notionally ADV ADV with cl/group, ADV with v … English dictionary
notional income — noun Financial benefits, eg the use of a company car, that have a calculable cash value for taxation purposes • • • Main Entry: ↑notion … Useful english dictionary
notional amount — The principal amount or face value of a derivative. Defined by the Financial Accounting Standards Board ( FASB) in FAS 133 as the number of currency units, shares, bushels, pounds or other units specified in a derivatives contract. The notional… … Financial and business terms
Notional Principal Amount — In an interest rate swap, the predetermined dollar amount on which the exchanged interest payments are based. Each period s rates are multiplied by the notional principal amount to determine the value of each counterparty s payment … Investment dictionary
notional amount — noun A nominal amount of a financial instrument that is used to calculate payments made on that instrument, especially for instruments that do not have a well defined face value or par value … Wiktionary
notional principal amount — Fin the value used to represent a loan in calculating interest rate swaps … The ultimate business dictionary
nominal value — The face value of a bond or a share ( shares) (which will not usually be the same as its price). Also known as par value. For a bond or redeemable share, it will usually indicate the value at which the bond or share will be redeemed by the issuer … Financial and business terms