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.
Tests for Consistency The consistency of the index numbers have been tested over the years. The most important of these tests are: The time reversal test The
What is the market risk premium in Spain at the present moment - the number which I have to use in the valuations? It is not possible to talk of "the" market premium for Spain.
Which ratios would a banker be most interested in when considering whether to approve an application for a short-term business loan? Explain. Bankers and another lenders use li
DIVIDEND POLICY Dividends provide the portion of a firm's net earnings which are paid out to the shareholders. the objective of financial management of maximizing the share
Investors are always interested in estimating the price sensitivity of a bond to change in market interest rates. Let us study how prices change both in terms of
Beta Value Risk is an important consideration while investing in any security. It is the possibility that realised returns will be less than the returns expected. The degree, t
Cash Books (Cash Payments and Receipts Journals) Cash books are the names given to the Cash Receipts Journal and the Cash Payments Journal. They are used to record the flow of
Floor Brokers These people have the responsibility of executing the trades forwarded by the FCMs on the floor of the exchange. They can also trade for their own account. They w
Question: (a) The future value (F) of a sum invested now can be calculated using the formula: F = P(1 + r) n Required: (i) Describe each of the other constituents in the
DQ #1: Discuss the challenges of VaR approaches in valuing risk. How does portfolio risk assessment differ from a single asset’s risk assessment? How do managers typically load ba
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