Front Month: The futures contract that is nearest to expiration unless this contract is currently being rolled-over and has less volume (per day) and open interest than the next-to-expire contract. This is also referred to as the "Prompt" contract/month and the "Prompt 0" contract/month.  

Back Month(s): Futures contracts that expire farther in the future than the front month contract. 

Day(s): Generally, anywhere that the term "Day" or "Days" is used, it is referring to a day (or days) on which the exchange for the applicable commodity is open. 

Horizon: The number of days into the future for which a forecast is made. 

Forward Curve: A chart of the prices (Y-Axis) of futures contracts at a progression of maturities (X-Axis) in the future. 

Term Structure: This term is used synonymously with "Forward Curve."

Price: The Close price of a specific derivative for a given date as reported by the exchange on which the derivative trades. 

Historical Price: A sequence (one or more) of actual Close prices (by date) that were reported by the exchange on which a specific derivative trades. 

Factor: An independent variable in a model that influences the target (dependent variable). 

Feature: This term is used synonymously with "Factor."

Forecast Uncertainty: Average downward percent error and upward percent error over the past 3 months.

Price Forecast: The Close price that is forecasted to occur for a specific derivative at a specific horizon. 

Prompt and Promptness: An ordinal measure of the days remaining until expiration of a futures contract. E.g. "Prompt 0" refers to the front month; "Prompt 1" refers to the first back month; "Prompt 2" refers to the second back month. 

Hit Rate: A performance metric for a price forecasting model that is used to quantify the model's directional accuracy. For a specific model, which provided price forecasts over a historical epoch, the Hit Rate of the model is calculated as the number of observations where the forecasted change in price had the same sign as the realized change in price; this number is normalized by the total number of forecasts that occurred in the epoch.   

Quota: A Strategy parameter representing the number of contracts that are specified for purchase of a specific commodity derivative within the Quota Period. 

Quota Period: A Strategy parameter representing the date range over which a Quota is to be filled. 

Strategy: A set of market actions for a specific derivative that occur over a time period and is inclusive of execution parameters. Generally, this is used in reference to a set of recommended purchases. 

Procurement Strategy: This term is used synonymously with "Strategy."

Strategy Price: The price that would have been realized on purchases of the specified contract if the Quota had been filled using the recommended purchases.

Benchmark Strategy: A purchasing strategy that is used as a reference to measure the effectiveness of the recommended purchases. Generally, the Benchmark Strategy purchases the same number of contracts of a commodity at the Close price on each day of the Quota Period such that the total number of contracts purchased equals the Quota. 

Benchmark Price: The average price that would have been realized on purchases of the specified contract if the Quota had been filled using the Benchmark Strategy.

Savings: The percent difference between the Strategy Price and the Benchmark Price for a specific Quota Period.

Sharpe Ratio: A performance metric of a strategy that is meant to provide a measure of risk-adjusted return. For a specific strategy, which yielded a sequence of profits & losses ("P&L") on executed trades, over a historical epoch, the Sharpe Ratio of the strategy is calculated as the average P&L divided by the standard deviation of the P&L for all trades that occurred in the epoch. 

Run Date: The date on which a model was run and created forecasts for a target (dependent) variable. For price forecasting models, the latest Run Date is usually the most recent date (prior to today's date) on which the applicable derivative exchange was open.  


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