Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Collar
A collar can be established by holding a share, along with purchasing a protective put and writing a covered call, where both options at out-of-money..
For Example - ONGC
Underlying stock = Rs. 809
Buy Mar Rs. 800 Put @ Rs.16
Write Mar Rs. 880 Call @ Rs.7.25
Total price for this strategy = 809 + 16 + 7.25 = Rs. 832.25
Maximum Profit: Limited
Call strike - Initial spot price - Put Premium = 880 - 809 - 16 = Rs. 55
Maximum Loss: Limited
Initial spot price - Put strike + Call Premium = 809 - 800 + 7.25 = Rs. 16.25
So an arbitrage opportunity to the tune of Rs. 55 (max) is available if the price target of Rs. 880 or beyond is achieved. On the flip side, we have losses, which are capped at a maximum of Rs 16.25 for price Rs. 800 and below.
What are the techniques of financial management There are two widely-discussed techniques: (i) Profit maximisation approach and (ii) Wealth maximisation approach.
Why do businesses spend time, effort, and money to produce forecasts? Explain. Businesses fail or succeed depending on how well prepared they are to deal with the situations t
Swap-Linked Notes: Interest rate swaps are derivative products which help in transforming the cash flows of existing debt issues. These are not only useful in covering the exis
How can the FX futures market be used for price discovery? Answer: To the amount that FX forward prices are an unbiased predictor of future spot exchange rates, the market antic
Functions of a Stock Exchange The stock exchange is a market place where investors trade in securities. It is a competitive market involving large numbers of buyers and sellers
Explain the terms- Stock and Share Stock Ownership of a company represented by shares that are a claim on the company's earnings and assets. Share Unit of equity
AOT limited is considering two mutually exclusive projects - cable and satellite. The possible NPVs for every project and their associated probabilities are as follows: Cable:
Development of the Market Until 1950s, T-Bills were issued by both the Central and State Governments and from 1950s, it is only the Central Government that is issuing Treasury
Jessica is given the opportunity to invest $5,000 now and receive $5,700 at the end of one year. However, she could only invest $1,000 of her own money and would need to borrow the
Q. Implications of Gordons fundamental valuation? Explanation: - The implications of Gordon's fundamental valuation may be as below: (1) While the rate of return of the firm
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd