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Earning The Points

What is 'Earning The Points'

A currency trading term that describes when the forward ask price is lower than the spot bid price, resulting in a gain for the trader. A trader is gaining the points when he or she sells at one price now then agrees to buy for less in the future. Gaining the point only refers to the difference between sell and buy prices and does not take the time value of money into account.

This is the opposite of "losing the points".

Explaining 'Earning The Points'

If the individual sells at the higher ask price in the spot market, then buys at a lower bid price in the futures market, he or she is gaining the points.

For example, suppose that Peter sells the British pound at 2.2055 dollars per British pound in the spot and enters into a forward contract to buy the pound back at 2.2000 dollars per pound in the future. Peter is gaining the points, in this case 0.0055 dollars per pound.


Further Reading


The economic implications of corporate financial reporting
www.sciencedirect.com [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

Subject choice and earnings of UK graduatesSubject choice and earnings of UK graduates
www.sciencedirect.com [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

Financial analysts' forecasts of earnings: A better surrogate for market expectationsFinancial analysts' forecasts of earnings: A better surrogate for market expectations
www.sciencedirect.com [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

Earnings Management and Accounting Order <span style=[J]' src='/thumbnails/?img=http%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-KJYJ200505008.htm' />Earnings Management and Accounting Order [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-KJYJ200505008.htm'>PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

Career plans and expectations of young women and men: The earnings gap and labor force participationCareer plans and expectations of young women and men: The earnings gap and labor force participation
www.jstor.org [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

Choice of auditors and earnings management during the Asian financial crisisChoice of auditors and earnings management during the Asian financial crisis
www.emerald.com [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

Corporate social responsibility, real activities earnings management, and corporate governance: evidence from KoreaCorporate social responsibility, real activities earnings management, and corporate governance: evidence from Korea
www.tandfonline.com [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

CEO incentives and earnings managementCEO incentives and earnings management
www.sciencedirect.com [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …

The expanding gender earnings gap: Evidence from the LEHD-2000 CensusThe expanding gender earnings gap: Evidence from the LEHD-2000 Census
www.aeaweb.org [PDF]
… Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing … Advanced methods of earnings management: monotonic trends and change-points under spotlight in …



Q&A About Earning The Points


How do you gain points?

By selling at a higher ask price in the spot market and buying at a lower bid price in the futures market.

When are you losing points?

When you sell at a lower ask price in the spot market and buy at a higher bid price in the futures market.

What does Earning the Points mean?

Earning the points means that a trader is gaining money when he or she sells at one price now then agrees to buy for less in the future.

Why does earning points not take into account time value of money?

Because it only refers to difference between sell and buy prices.