Local Exchange Trading Systems

AAA

DEFINITION of 'Local Exchange Trading Systems'

A locally organized economic organization that allows members to participate in the exchange of goods and services among others in the group. Local Exchange Trading Systems (LETS) use a locally created currency as denominations of units of value which can be traded or bartered in exchange for goods or services. Members of LETS typically view the systems as organized and cooperative schemes that maximize purchasing power while benefiting members and the community.

INVESTOPEDIA EXPLAINS 'Local Exchange Trading Systems'

Local Exchange Trading Systems typically exhibit five fundamental traits: cost of service, consent, disclosure, equivalence to the regional currency, interest-free. These traits along with general guidelines such as membership fees, detailed logs of transactions and member directories allow for an organized and well run exchange. Additionally, transactions do not necessarily require a nominal exchange of units. For instance, members can repay other members who have performed for them a service by providing a service in return, as opposed to paying for the original service.

RELATED TERMS
  1. Capitalism

    A system of economics based on the private ownership of capital ...
  2. Socialism

    An economic and political system based on public or collective ...
  3. Classical Economics

    Classical economics refers to work done by a group of economists ...
  4. Invisible Hand

    A term coined by economist Adam Smith in his 1776 book "An Inquiry ...
  5. Free Enterprise

    An economic system where few restrictions are placed on business ...
  6. Electronic Communication Network ...

    An electronic system that attempts to eliminate the role of a ...
Related Articles
  1. thinkstock|istock
    Options & Futures

    A Primer On The Forex Market

    Moving from equities to currencies requires you to adjust how you interpret quotes, margin, spreads and rollovers.
  2. Forex Education

    Top 7 Questions About Currency Trading Answered

    Whether you're puzzled by pips or curious about carry trades, your queries are answered here.
  3. Options & Futures

    Getting Started In Forex

    Before entering this market, you should define what you need from your broker and from your strategy.
  4. Forex Education

    The International Money Market

    Banks, corporations, traders and speculators all use the IMM to borrow, lend, trade, profit, finance, speculate and hedge risks.
  5. Trading Strategies

    Steps To Becoming A Quant Trader

    These days, being highly proficient in mathematics or statistics is the bare minimum requirement for being a quant. You'll need a whole lot more than that.
  6. Trading Strategies

    How Trading Algorithms Are Created

    The steps quantitative traders, and traders using algorithms, follow in order to create their algorithms.
  7. Trading Strategies

    Quants: What They Do and How They've Evolved

    It sounds exciting to be a quantitative trader, but what do they do? Here's a sneak peak into the world of a "quant."
  8. OTC trades tend to be for smaller company stocks and debt securities.
    Investing

    Trading Over the Counter

    OTC trades tend to be for smaller company stocks and debt securities. Debt securities such as bonds are generally traded by investment banks making markets for specific issues.
  9. Investing News

    Has High Frequency Trading Ruined The Stock Market For The Rest Of Us?

    HFT is a controversial trading strategy. This article looks at how HFT affects the retail investor.

You May Also Like

Hot Definitions
  1. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  2. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  3. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  4. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
  5. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), expressed as a single percentage number that represents ...
  6. Free Carrier - FCA

    A trade term requiring the seller to deliver goods to a named airport, terminal, or other place where the carrier operates. ...
Trading Center