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What else can I help you with?
When a risk has been idenifed the first option to consider in reducing the risk should be?
eliminate the risk altogether
What is a cylinder option?
A cylinder is a collar or risk reversal.
What is The market development option that brings the highest risk?
No
What is the relationship between a regular call option and binary call option and a gap call option?
Regular call options have limited risk and unlimited upside gains while binary call options have limited risk along with limited upside gain.
Why might you choose to invest in a high-risk opportunity instead of a low-risk option?
Investing in a high-risk opportunity can potentially lead to higher returns compared to a low-risk option. While there is a greater chance of losing money with high-risk investments, the potential for greater rewards may be appealing to some investors who are willing to take on more risk in exchange for the possibility of higher profits.
What is the impact of option convexity on the pricing and risk management of financial derivatives?
Option convexity refers to how the price of an option changes in response to changes in the underlying asset's price. It affects the pricing and risk management of financial derivatives by influencing the sensitivity of the option's price to market movements. Higher convexity can lead to larger price changes, increasing both potential profits and risks for investors. Understanding and managing option convexity is crucial for accurately pricing derivatives and effectively managing risk in financial markets.
The investment option with the highest rate of return and highest degree of risk is?
junk bonds
What is the difference between currency future and currency option?
The difference between a currency future and a currency option is the option is the amount paid is all that is at risk and with future you could lose a lot more.
In what ammount does the strike price of an option move?
The strike price of an option does not change - strike price is fixed for the duration of the option. The price of the option will move based on the following: * Price of underlying asset (moves with - asset price goes up, option price goes up) * Time left to expiration (moves with - time left goes down, option price goes down) * Volatility of underlying asset (moves with - volatility goes up, option price goes up) * Risk free rate (moves with - risk free rate goes up, option price goes up)
What is meant by currency option trading?
Currency option trading is a common term used in financial discussions between business people. They are referring to trading currencies on the market to hedge their risk.
What is the best no risk investment option available?
The best no-risk investment option available is a high-yield savings account or a certificate of deposit (CD) from a reputable bank. These options offer guaranteed returns and are insured by the Federal Deposit Insurance Corporation (FDIC) up to certain limits, making them low-risk choices for preserving your capital.
If prices drop what happens to call option prices?
If the price of an underlying commodity or security drops, the value of call options will decline as well. If you are long the calls this would be bad. If you are short the calls this would be good. Long Call - Risk Limited to Option Premium Paid, Profit Unlimited. Hoping for Market Rise. Short Call - Risk Unlimited, Profit limited to the premium received for the option. Hoping for Market Decline, or stay the same. Long Put - Risk Limited to Option Premium Paid, Profit Unlimited. Hoping for Market Decline. Short Put - Risk Unlimited, Profit limited to the premium received for the option. Hoping for Market Rise, or stay the same.
