Fungibles

DEFINITION of 'Fungibles'

Goods, securities or instruments that are equivalent and, therefore, interchangeable. In other words, they are goods that consist of many identical parts which can be easily replaced by other, identical goods. If the goods are sold by weight or number, this is a good sign that they are fungible.

BREAKING DOWN 'Fungibles'

Commodities, common shares, or the same company, and dollar bills are examples of fungibles. Fungibility of listed options makes it possible for buyers and sellers to close out their positions by taking offsetting positions. For example, if you buy a long call option, you can close out the position by selling (writing) a put option with the same underlying, expiration date and strike price.

RELATED TERMS
  1. Fungibility

    A good or asset's interchangeability with other individual goods/assets ...
  2. Security

    A financial instrument that represents an ownership position ...
  3. Identity Theft

    The crime of obtaining the personal or financial information ...
  4. Social Identity

    A company's image as derived from its relationships. An organization's ...
  5. Substantially Identical Security

    A security that is so similar to another that the Internal Revenue ...
  6. Hard Asset

    A tangible and physical item or object of worth that is owned ...
Related Articles
  1. Economics

    Explaining Fungibility

    Fungibility refers to a good’s or asset’s interchangeability with another good or asset.
  2. Options & Futures

    Trade Smarter With Equivalent Positions

    Understanding the concept of equivalent positions will help you trade more efficiently and save money on trade fees.
  3. Economics

    Understanding Brand Identity

    A brand identity comes from visible elements, such as the company name, the design of its logo, its packaging design, and colors, tagline and typeface.
  4. Credit & Loans

    Protect Your Kids Against Identity Theft

    Children have valid Social Security numbers and no debt, which makes them ideal targets. Here’s what parents can do to prevent a scam.
  5. Options & Futures

    Getting Acquainted With Options Trading

    Learn more about stock options, including some basic terminology and the source of profits.
  6. Taxes

    5 Ways to Avoid Identity Fraud

    Identity theft was the number one consumer complaint in 2014. Here are some ways you can protect yourself.
  7. Credit & Loans

    How to Recover From Identity Theft

    Identity theft isn't going away, and fixing it can take time and money. But doing nothing isn't an option. Rather than become a victim, it is time to take action.
  8. Options & Futures

    The Basics of Options Profitability

    The adage "know thyself"--and thy risk tolerance, thy underlying, and thy markets--applies to options trading if you want it to do it profitably.
  9. Options & Futures

    Cut Down Option Risk With Covered Calls

    A good place to start with options is writing these contracts against shares you already own.
  10. Investing News

    This is the Fastest-Growing Consumer Complaint

    There’s no way to guarantee that your Social Security number won’t fall into the wrong hands. Here are some ways to make yourself less of a target.
RELATED FAQS
  1. What is the difference between a capital good and a consumer good?

    Learn to differentiate between capital goods and consumer goods, and see why capital goods require savings and investment ... Read Answer >>
  2. How are industrial goods different from consumer goods?

    Understand the difference between industrial goods and consumer goods, and learn the different types of industrial goods ... Read Answer >>
  3. Why would someone change their Social Security number?

    Learn the reasons a person might choose to change his Social Security number, including identity theft and abuse, and discover ... Read Answer >>
  4. How are call options priced?

    Learn how aspects of an underlying security such as stock price and potential for fluctuations in that price, affect the ... Read Answer >>
  5. What's the difference between cost of goods sold (COGS) and cost of sales?

    Explore the difference between the cost of goods sold and cost of sales listed on an income statement, and what types of ... Read Answer >>
  6. How do I change my strike price once the trade has been placed already?

    Learn how the strike prices for call and put options work, and understand how different types of options can be exercised ... Read Answer >>
Hot Definitions
  1. Reverse Mortgage

    A type of mortgage in which a homeowner can borrow money against the value of his or her home. No repayment of the mortgage ...
  2. Labor Market

    The labor market refers to the supply and demand for labor, in which employees provide the supply and employers the demand. ...
  3. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  4. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  5. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  6. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
Trading Center