Blue Month


DEFINITION of 'Blue Month'

The month during which there is the greatest trading activity in derivatives trading. These derivatives can be options, futures, or other type of derivative-based instruments. The occurrence of a blue month is typically of interest to hedge funds and large financial institutions because the volume of derivative trading can be used as a technical trading signal.


Volumes of daily traded shares are much more accessible than the volume of daily derivative trading. However, options and futures trading activity is also publicly accessible to keen investors. The month when the volume of derivative trading is highest is referred to as the blue month.

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  1. Do hedge funds invest in commodities?

    There are several hedge funds that invest in commodities. Many hedge funds have broad macroeconomic strategies and invest ... Read Full Answer >>
  2. How do hedge funds use equity options?

    With the growth in the size and number of hedge funds over the past decade, the interest in how these funds go about generating ... Read Full Answer >>
  3. Can mutual funds invest in options and futures?

    Mutual funds invest in not only stocks and fixed-income securities but also options and futures. There exists a separate ... Read Full Answer >>
  4. How do futures contracts roll over?

    Traders roll over futures contracts to switch from the front month contract that is close to expiration to another contract ... Read Full Answer >>
  5. How does a forward contract differ from a call option?

    Forward contracts and call options are different financial instruments that allow two parties to purchase or sell assets ... Read Full Answer >>
  6. Why do companies enter into futures contracts?

    Different types of companies may enter into futures contracts for different purposes. The most common reason is to hedge ... Read Full Answer >>

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