DEFINITION of 'Fixing'

The practice of arbitrarily setting the price of a good or commodity. Fixing represents a refusal to allow the forces of a free market to determine the price of the good. It can be either legal or illegal depending upon who mandates the fix, such as the government or a group of merchants. Although, "fixing" usually refers to "price fixing," it can be applied to input costs or fixing supply. For example, governments can mandate the quantity goods produced in a region.


Fixing can take many forms. OPEC artificially quadrupled the price of oil in the 1970s and effectively cut off its supply to much of the western world. Cartels are formed for the purpose of fixing the price of one or more of the goods that they produce, such as oil or other commodities. Capitalist governments also fix the prices of certain goods to promote smaller companies to enter the industry.

  1. Derivative

    A security with a price that is dependent upon or derived from ...
  2. Commodity Swap

    A swap in which exchanged cash flows are dependent on the price ...
  3. Commodity

    1. A basic good used in commerce that is interchangeable with ...
  4. Commodity ETF

    Exchange-traded funds that invest in physical commodities such ...
  5. Futures Contract

    A contractual agreement, generally made on the trading floor ...
  6. Deficit

    The amount by which a resource falls short of a mark, most often ...
Related Articles
  1. Personal Finance

    Early Monopolies: Conquest And Corruption

    This structure can be very effective, but it is also known for its abuse of power.
  2. Entrepreneurship

    The Series 3 Exam: Creating A Career With Commodities

    The Series 3 exam is the quickest way to diversify sales and add futures to your investing options.
  3. Options & Futures

    Are You Ready To Trade Futures?

    If you want to trade futures in the hopes that you'll become rich, you'll have to answer some questions first.
  4. Mutual Funds & ETFs

    Commodity Funds 101

    These funds make investing in gold, oil or grain an easier prospect.
  5. Investing

    What a Fed Delay Means for the ECB & BoJ

    The Fed’s continued delay has repercussions for more than just the U.S. economy and markets. The ECB and the BoJ may support the case for stocks in Europe.
  6. Economics

    Understanding Income Inequality

    Income inequality refers to the uneven distribution of income across a single economy.
  7. Economics

    Who is a Hawk?

    In the economic sense of the word, a hawk is someone who believes high interest rates should be maintained to keep inflation low.
  8. Investing Basics

    Explaining Fixed Exchange Rates

    A government using a fixed exchange rate has linked the value of its currency to the value of another country’s currency, or the price of gold.
  9. Investing Basics

    Learn How To Trade Gold In 4 Steps

    Trading spot gold or gold futures, equities and options isn’t hard to learn, but the activity requires skill sets unique to these markets.
  10. Economics

    The Effect of Fed Fund Rate Hikes on Gold

    Explore the historical relationship between interest rate increases and the price of gold, and consider what effect a fed funds rate hike might have on gold.
  1. When and why did brokerages switch from fixed commissions to negotiated ones?

    On May 1, 1975, there was no lightning, white calves or other omens to mark the moment when brokerages switched from fixed ... Read Full Answer >>
  2. What is Ginzy trading?

    Ginzy trading is an order of different prices placed by a floor broker. It occurs when a floor broker attempts to avoid an ... Read Full Answer >>
  3. Who decides to print money in Russia?

    The Central Bank of the Russian Federation (CBRF), like its peers in most countries, is the governmental entity responsible ... Read Full Answer >>
  4. Who decides to print money in Canada?

    In Canada, new money comes from two places: the Bank of Canada (BOC) and chartered banks such as the Toronto Dominion Bank ... Read Full Answer >>
  5. 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 >>
  6. Who decides when to print money in India?

    The Reserve Bank of India, or RBI, manages currency in India. The bank's additional responsibilities include regulating the ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Purchasing Power

    The value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. Purchasing ...
  2. Real Estate Investment Trust - REIT

    A REIT is a type of security that invests in real estate through property or mortgages and often trades on major exchanges ...
  3. Section 1231 Property

    A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ...
  4. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
  5. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  6. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!