A handle is the entire part of a quote. For example, if the stock quote is $ 56.25, the handle is $ 56, which eliminates the decimal. On the foreign exchange markets, the descriptor refers to the part of the price offer which appears both in the offer and in the offer for the currency. For example, if the EUR / USD currency pair has a supply of 1.4183 and a demand of 1.4185, the processing would be 1.41 – the part of the quote that is equal to both the supply and on demand. A handle is also called a large figure.
Breaking the handle
Traders often only refer to the handful of a quote, as it is assumed that other market players know the root of the quote. In the foreign exchange markets, the movement of the minimum price is called pip. Since many exchange instruments are quoted at four or five decimal places, it is considered easier to refer to the last two places when discussing offers and requests, rather than including the handle, which tends to be known to the participants.
Handle and foreign exchange markets
Foreign currency encompasses a wide range of transactions: everything from currency conversions by a traveler in an airport kiosk to international payments of a billion dollars made by companies, financial institutions and governments. Specific examples include financing of imports and exports, as well as speculative investment positions without underlying goods or services. Growing globalization has corresponded to a significant increase in the number of foreign exchange transactions.
In the midst of the vast global foreign exchange market, the spot markets and the futures markets are very relevant to the term futures. Cash markets are markets for financial instruments such as commodities and securities which can be traded immediately or on the spot. Cash markets depend on spot prices or current market prices. This contrasts with the futures market, which works with prices at a later date. In both cases, participants in these markets must understand the handle and stem of their price offerings.
Cash markets can be organized exchanges or over-the-counter (OTC) markets. Although the spot exchange rate is the earliest value date, in general, the standard settlement date for is two business days after the transaction date. Some exceptions exist, including crude oil transactions. In this case, the goods are sold at the spot price, but physical delivery takes place at a later date.