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Error

• Is a mistake in terms of quantity, type of order, side of market (purchase or sale), security, or other condition of a trade.

 
 Embedded terms in definition
 Market
Order
Security
Trade
Type
 
 Referenced Terms
 Error account: Is the destination for the temporary placement of a trade which was involved in an Error transaction. Firms will either take immediate market action to correct the error, or sometimes will keep the position there as they work it out. See Work Out.

 Sequential analysis: Is a small sample, nonparametric method. It does not presuppose sample sizes or probability distributions. It is an effective technique to use when analyzing or monitoring hedge or trading programs. The approach uses Type I and Type II Error frameworks.

 Standard error: In statistics, a measure of the possible Error in an estimate.

 Variance minimization approach to tracking: An approach to bond indexing that uses historical data to estimate the variance of the tracking Error.

 Work out: Is the process to cover a short or liquidate a long position. This activity can be the result of an Error transaction, unsold inventory, or closing out a large position.

 
 Related Terms
 Benchmark error
Error account
Measurement error
Standard error
Tracking error

<< Erosion Error account >>

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