Stock Options and Futures

Zero sum is maintained by the fact that there is always two parties in a futures transaction; the Long and the Short. One wins at the expense of the other. It does matter how many speculators or hedgers there are because each individual futures contract is entered into by two parties.

IF you are BUYING the option, neither is necessarily more risky than the other. The longer the expiration date, the more likely the market will go up, so the call becomes more appealing. In both, the most you can loose is the premium paid. IF you are SELLING the option, selling the put is more risky. Because a stock can technically go to infinity, you have unlimited loss potential. When selling a call, you can only loose up to the value of the stock as long as the call is covered.

I just read the above ...it's backward.

Puts exercise if the share price is below the strike price, not above. You can potentially lose everything between the strike price and zero--I'm neglecting the premium for now. If you write calls, you can lose everything between the strike price and the share price. If it's a covered call, it's a paper loss, but if you write naked calls you lose real money. It depends on the writer's investment strategy.

Churners are more at risk with puts than are buy-and-hold guys. If I own a lot of stock that's at $102, believe it's really worth that, and want more of it anyway, why wouldn't I want to write a put with a seven-day expiration period at $100 with a $5 premium? This brings the price of the stock down to $95 per share, which is a great deal! Churners approach puts tactically: they subtract the premium from the expiration price. In this case, that would be $95. If they think the stock will be lower than $95, they know they can buy it from a broker cheaper so the put's a bad investment. If it's between $95 and $100, they'll use part of the premium to pay for the stock so it starts to look like a better deal.

Writing calls is either moderately risky or unbelievably insane. If you're in a covered call, all you can lose is the difference between the share price and the strike price, and that's "paper wealth" anyway. The flipside of a covered call is that it stabilizes transactional income. If you're trying to get out of a position slowly, or you've got so much of it you can afford to shed some, selling a thousand shares at $100 in a covered call means you know there will be $100,000 more in your brokerage account at the end of the deal.

A naked call--you offer to sell stocks you don't own in a transaction where "in the money" means share price is higher than strike price--is different: these are so risky a lot of investment houses won't trade in them. If you write a naked call for 10,000 shares at $100 and the stock shoots up to $140, you need to pull $400,000 out of thin air right now. If you write the same call and the stock drops to $70, you're golden: someone probably paid you $10 per share to do that.

So...as far as futures contracts go, here are the relative risk levels:

Low

Covered puts

Naked puts (slightly riskier because, as with all naked transactions, there's a chance the security won't be available when the option exercises)

Covered calls

Casino gambling

Naked calls

High

That doesnt make sense.

The current stock price? Well that would be $7.

Holding stock means that a business keeps the stock that it need and uses in the factory itself.

mutilateral trading system is a system that design for technique analysis (such as graph) for those who invest in share markets. It will indicate whether the share is up or down by it technique way. I hope I answer your question. WWW.MFSMARKETS.COM

Insider trading" is a term that most investors have heard and usually associate with illegal conduct. But the term actually includes both legal and illegal conduct. The legal version is when corporate insiders-officers, directors, and employees-buy and sell stock in their own companies. When corporate insiders trade in their own securities, they must report their trades to the SEC

The primary reason for the divergence of objectives between managers and shareholders has been attributed to separation of ownership (shareholders) and control (management) in corporations. As a consequence, agency problems, or principal-agent conflicts exist in the firm.

plz tell me how many companies in bse &nse plz tell me how many companies in bse &nse

Issuing Par Value Common Stock for Cash

(assume par value is $1) dr. Cash $1.00

cr. Common Stock $1.00

to record issuance of 1 share of $1 par common stock if sold for more than par value (Assuming $5) dr. Cash $5

cr. Common Stock $1

Paid-in Capital in excess of par $4

to record issuance of 1 share of common stock in excess of par.

Investment in a commodity index generally entails (i) the bulk of the investment's being put into secure instruments such as Treasury bills and (ii) the remainder of the investment going into futures. The most liquid futures tend to be those in the very near term, and they usually have short maturities, typically 1 month, so investment in liquid futures means investing in a contract that is likely to mature in the near future. Given that the investment term in the index is open-ended, the futures investment component is going to move from one future to the next succeeding future during the life of the underlying index investment. For example, a 5 year investment might involve a change in the underlying futures on 60 monthly occasions. The investment is "rolled" from one futures contract to the next at which time if the price of the expiring contract is higher than the replacement contract (positive roll yield), selling the expiring and buying the replacement will yield a positive cash result. If the replacement contract is higher in price than the expiring contract, the reverse is true (negative roll yield). This can be visualized by considering that the initial futures investment is at a point on a curve of futures price (y-axis) v. time (x-axis). For the most liquid commodities such as crude oil and natural gas, monthly futures contracts are priced from next month right out to a point more than 5 years from today. If, moving out in time, successive futures prices are higher, the price curve is said to be in "contango". If the later prices are lower, the curve is said to be in "backwardation". A moment's consideration should show that a positive roll yield will occur in a backwardated curve, while a negative roll yield will occur in a contango curve. This is because the initial investment point on the curve moves to the left as time elapses and contract roll is approached. Moving to the left in a backwardated curve would mean the the price of the contract that the investor currently holds will rise (if nothing else changes in the market, and the spot price of the commodity is constant). At the point of rolling, the point on the curve jumps back to the right as a new contract is purchased. In a backwardated curve, this point to the right must be below the price point at which the contract was rolled, i.e. a positive roll yield. Investment in a commodity index generally entails (i) the bulk of the investment's being put into secure instruments such as Treasury bills and (ii) the remainder of the investment going into futures. The most liquid futures tend to be those in the very near term, and they usually have short maturities, typically 1 month, so investment in liquid futures means investing in a contract that is likely to mature in the near future. Given that the investment term in the index is open-ended, the futures investment component is going to move from one future to the next succeeding future during the life of the underlying index investment. For example, a 5 year investment might involve a change in the underlying futures on 60 monthly occasions. The investment is "rolled" from one futures contract to the next at which time if the price of the expiring contract is higher than the replacement contract (positive roll yield), selling the expiring and buying the replacement will yield a positive cash result. If the replacement contract is higher in price than the expiring contract, the reverse is true (negative roll yield). This can be visualized by considering that the initial futures investment is at a point on a curve of futures price (y-axis) v. time (x-axis). For the most liquid commodities such as crude oil and natural gas, monthly futures contracts are priced from next month right out to a point more than 5 years from today. If, moving out in time, successive futures prices are higher, the price curve is said to be in "contango". If the later prices are lower, the curve is said to be in "backwardation". A moment's consideration should show that a positive roll yield will occur in a backwardated curve, while a negative roll yield will occur in a contango curve. This is because the initial investment point on the curve moves to the left as time elapses and contract roll is approached. Moving to the left in a backwardated curve would mean the the price of the contract that the investor currently holds will rise (if nothing else changes in the market, and the spot price of the commodity is constant). At the point of rolling, the point on the curve jumps back to the right as a new contract is purchased. In a backwardated curve, this point to the right must be below the price point at which the contract was rolled, i.e. a positive roll yield.

An open outcry is a traders attempt to verbally shout either a buy or sell order.

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Kind of.

In an Open Outcry system, which is mostly used on commodities exchanges, traders use hand signals to issue buy or sell orders. They scream, too, but the orders are actually placed through the use of hand signals. This is going away, to be replaced by electronic signaling systems. Some traders prefer open outcry; they know the other traders in the pit and how they trade, and by watching them you can tell what to do on an issue.

Option value is composed of two components : Option value = Intrinsic value + time value Intrinsic value is the amount by which the option is in the money and given by the formula Max (0, S-X) Time value of option - this value depends on the time until the expiration date and the volatility of the underlying instrument's price. The time value of an option is always positive and declines exponentially with time, reaching zero at the expiration date. If the option is out of money its intrinsic value will be 0 but will still have time value of money and hence options sell higher than their exercise price.

Read more: http://www.justanswer.com/questions/1v2lv-options-sell-prices-higher#ixzz0NUj0iVGm

The ticker symbol for Fifth Third Bancorp is FITB and it is traded on the Nasdaq.

G/L = (amount sold (for underlying security) - amount paid (for underlying security))+ premium paid

There are commercial tools available to help you with covered call trade selection and covered call portfolio management. They will also perform the profit/loss calculations. See www.borntosell.com as an example.

Well, if you want a dictionary response, then your future is the life ahead of you, and what will happen to your life over time.

Your future is what you make it, and do not let anyone tell you different.

Persons interested in currency trading will want to know how to get started; find trading data; open an account;fill a trading order; view the results of a trade gain or loss.

A future transaction is something that is agreed upon by 2 or more parties for a date yet to come. An example would be an agreement for someone to purchase a car the next day when they have the cash.

This is a very good question!

First is the design phase.

To complete this you will have to answer the following questions and more, but this is a good start.

What are we trying to build?

What do we want it to look like when we are done?

Where are we building it?

Are there any site element problems?

What are the local building codes?

Start with a good design that you like. At this stage there is no reason to have any professionals involved as you are freely adding what you want into the design.

It is advisable however, to have an architect on board if you want to keep closer to reality. Architects are there to help you get what you want WITHIN REASON. Keep in mind budget, engineering and code requirements as you progress.

As a building inspector and plans examiner, I see too many plans that have to be drastically altered because someone forgot to keep these in mind during the design development phase. This is however, not the time to concentrate on any of these.

Second is the engineering phase.

This is where a good architect and engineer are worth their weight in gold. Depending on your project you may need more than one engineer. They all need to be on the same page and have a good working relationship. It is my suggestion that you get a good structural engineer and ask them to refer you to a good architect, not the other way around, then add other engineers as required.

Engineers tend to be a little more grounded in the reality of what will and what will not work and architects are better referred to as artists, which add beauty and form to the physical function of a project. Both are good and both have their place in a project. Having a referral from an engineer is more likely to land you a well grounded architect that has good working relation with other engineers and local building officials.

Third is the refining stage.

This is where everything is reviewed for compatibility. During this phase it is advisable to keep all of the documents traveling through a single source. This is usually the architect. It will be this persons job to ensure that each of the trades have what they need. This will include proper space, access, detailed drawings and connectivity to other trades etc.

Example: The mechanical engineer will need to have a place to put the heating and air conditioning units. If this is going to be on the roof the structural engineer will need to be sure that the roof is capable of handling this and the electrical engineer will have to plan for getting electricity there as well. The architect will have to make sure that there is enough room in the attic or ceiling space for duct work, truss members, the recessed lighting fixtures and if a sprinkler system is required then the plumbing will have to be accounted for as well. This is a very important position to be in and can cost hundreds, thousands or millions of dollars in change orders if not done properly.

It is even advisable on larger projects to have someone not involved in the project review for completeness after the architect feels that it has all been done.

Last is Code Review.

This is usually completed by the local building official or plans reviewer and is paid for as part of the permit. If the engineers and architect have done their job with efficiency and accuracy there will be few changes required.

Project Planning involves 4 important phases. They are:

1. Planning the Project Scope

2. Planning the Project Resources

3. Planning the Project Schedule

4. Planning Quality & Risk Management

Yes the stock on a Winchester Model 12 16 gauge is the same as a 20 gauge. 16 gauge,20 gauge, and 28 gauge are all the same for the Winchester Model 12. Thanks, Tim

You usually sign an agreement when you rent the house that it is a "rent to own option" At the end of a certain period if you choose to buy, a percentage of the money that you have paid in rent will go to toward the purchase price. If you choose not to buy, it will be just like an ordinary rental agreement with the owner being that mcuh richer as far as the money you have paid in rent. Hope this helps.