A base rate is the interest rate that a central bank – such as the Bank of England or Federal Reserve – will charge commercial banks for loans. The base rate is also known as the bank rate or the base interest rate.

 

At the money (ATM) is a term used to describe an options contract with a strike price that is identical to the underlying market price. At the money, options see a lot of trading activity, because they are so close to becoming profitable.

 

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