For the credit futures markets, it is the number that relates different coupons and acceptable deliverable maturities for delivery against the contract standard of an 8 percent coupon and the stipulated acceptable time remaining to maturity specifications. For the security markets, it is the contractual number that indicates how many shares a convertible security can be exercised into at any point in time.
A figure published by the CBOT used to adjust a T-Bond hedge for the difference in maturity between the T-Bond contract specifications and the T-Bonds being hedged.
A factor used to equate the price of T-bond and T-note futures contracts with the various cash T-bonds and T-notes eligible for delivery. This factor is based on the relationship of the cash-instrument coupon to the equired 8 percent deliverable grade of a futures contract as well as taking into account the cash instrument's maturity or call.