Speculation, Excessive

Speculation is a prediction or a conjecture about an outcome, which inherently contains an assessment of risk and the likelihood or probability of something. In commercial and financial markets, speculation involves the intentional assumption of risk in exchange for potential gain or loss. Speculation, by its nature, involves taking a view, either in principle or via the entry of a position in a financial contract, such that the realization of the outcome, or more often, a price, determines the payoff. There is no formal, widely accepted definition of what constitutes “excessive” speculation, but the public discourse surrounding the term has focused on the implications of statutory and regulatory assertions of harm resulting from speculation and the profits (or losses) that accompany it. For example, since ...