Definition of Delivery Notice

It is a notice of a clearing member’s intention to deliver a stated quantity of a commodity in settlement of a short futures option.

The holder in a futures contract with a short position writes a notice informing the clearing house of his/her intention and particular about delivering a commodity for settlement. The delivery notice is significant in the cases of both short and long positions in a futures contract.

Points to remember:

• The notice is a clear written contract.
• It describes the specifics about the commodities, and the delivery.