Cylinder

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Dictionary Says

Definition of 'Cylinder'

A term used to describe a transaction, involving two derivatives, where there is no initial cost bourne by the investor when entering into the position.
Investopedia Says

Investopedia explains 'Cylinder'

For example, an investor can sell a derivative and use its proceeds to purchase another security. A cylinder is different from a positive carry trade since it does not necessarily imply offsetting positions.

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