Cost Of Carry

Costs incurred as a result of an investment position. These costs can include financial costs, such as the interest costs on bonds, interest expenses on margin accounts and interest on loans used to purchase a security, and economic costs, such as the opportunity costs associated with taking the initial position.

Cost to carry may not be an extremely high financial cost if it is effectively managed. For example, the longer a position is made on margin, the more interest payments will need to be made on the account. When making an informed investment decision consideration must be given to all of the potential costs associated with taking that position.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Cost of carry — This article is about the financial term. For the marketing term, see Carrying cost. The cost of carry is the cost of carrying or holding a position. If long, the cost of carry is the cost of interest paid on a margin account. Conversely, if… …   Wikipedia

  • cost of carry — (or carry) For physical commodities such as grains and metals, the cost of storage space, insurance, and finance charges incurred by holding a physical commodity. In interest rate futures markets, it refers to the differential between the yield… …   Financial and business terms

  • Cost of carry — Related: Net financing cost * * *    The difference between the interest generated on a cash instrument such as a bond or a Treasury bill and the cost of funds to finance the position.    ► See also Positive Carry, Negative Carry …   Financial and business terms

  • cost-of-carry — noun Finance the difference between the cost and the financial benefit of holding a particular asset for a specified period …   English new terms dictionary

  • cost of carry — The degree to which the costs of holding a financial position exceed the return from it …   Accounting dictionary

  • cost-of-carry market — Applies to derivative products. futures contracts trade in a cost of carry market where the underlying commodity can be stored, insured, and converted into the future easily and inexpensively. arbitrageurs, because of the ease of switching from… …   Financial and business terms

  • Carry (investment) — The carry of an asset is the return obtained from holding it (if positive), or the cost of holding it (if negative) (see also Cost of carry). For instance, commodities are usually negative carry assets, as they incur storage costs or may suffer… …   Wikipedia

  • Carry — or carrying may refer to: *Carry (arithmetic), when a digit becomes bigger than limit and the extra is moved to the left **Carry flag, the equivalent in calculation in a computer *Carrying (basketball), a rule breach in basketball *Carry… …   Wikipedia

  • carry — [kar′ē] vt. carried, carrying [ME carien < Anglo Fr carier < NormFr carre, CAR1] 1. to hold or support while moving [to carry a package] 2. to take from one place to another; transport, as in a vehicle [to carry the mail] 3. to hold …   English World dictionary

  • Carry-save adder — MotivationA carry save adder is a type of digital adder, used in computer microarchitecture to compute the sum of three or more n bit numbers in binary. It differs from other digital adders in that it outputs two numbers of the same dimensions as …   Wikipedia

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