Cover

The act of completing a transaction in order to remove any obligations.


Cover is a general term used in many different instances. For instance, an investors that recently puchased a security will have to cover the puchase by depositing the necessary funds. Or, an investor may wish to cover his/her short position by purchasing the stock. Or, a portfolio manager may wish to cover his/her risk exposure by buying an offsetting position.



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Related Terms

Covered Call

Portfolio

Short Covering

Short Selling

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