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Finance Dictionary and Glossary of Investment Terms
he price an investor pays for a security plus any out-of-pocket expenses. It is used to determine capital gains or losses for tax purposes when the stock is sold. Also, for a futures contract, the difference between the cash price and the futures price observed in the market.
1. A term used to describe the variation between the spot price of a deliverable commodity and the relative price of the futures contract for the same actual that has the shortest duration until maturity. 2. A security's basis is the purchase price after commissions or other expenses. Also known as cost basis or tax basis.