Mindblown: a blog about philosophy.
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Tesla (TSLA) is mulling a plant near Mexico City’s new airport which would be used as an export hub, according to Mexican government spokesperson cited by Reuters
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Elements of an Option Price
ELEMENTS OF AN OPTION PRICE An option price is composed of several elements: Intrinsic value: the amount by which an option is in-the-money, if at all. Time value: the value an option has due to the possibility of future price movements and the time remaining until expiration. Volatility: the uncertainty in the size and frequency…
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The Rules of Financial Trading
Do not be a Trade-aholic. You trade to make money-not for fun and games. Never add to a bad trade. Once you have a profit on a trade, never let it become a loser. NO WISHIING, NO HOPING, NO PRAYING Don’t be a one-way trader-be flexible.
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2023 guide JPM
mi-guide-to-the-markets-us
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Vera
Also known as Rhova. Second order Greek which measures sensitivity of option price to small changes in volatility and interest rates, sensitivity of rho to small changes in volatility, or sensitivity of vega to small changes in interest rates.
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A-B
ADJUSTMENT: The process by which the holder of a spread buys or sells stock or options in order to re-establish neutrality in his/her position. AMERICAN-STYLE OPTION: An option that can be exercised at any time on or before the expiration date. ARBITRAGE: The process in which traders simultaneously buy and sell similar securities for a…
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C-D
CALL OPTION: A call option is a financial derivative contract that provides the holder with the right, but not the obligation, to purchase a specific underlying asset at a predetermined price on or before a predetermined date. It gives the holder exposure to potential profits from an increase in the underlying asset’s price without actually…
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E-F
EDGE: The difference between market price and theoretical value-i.e. the long term advantage or disadvantage to the holder of an option position which has been calculated by using an option valuation model. ENFICIENT MARKET HYPOTHESIS: The EMH view of the markets believes that information is priced instantaneously into stock prices as soon as it is…
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G-H
GAMMA: The sensitivity of an options’ delta over a one point change in the underlying. Als known as the delta of the delta. GREEKS: A set of factor sensitivities frequently used for measuring the exposures of derivative portfolios. HAIRCUT: On cquity option exchanges, money deposited by a trader with the clearing house to ensure the…
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I-J
IMPLIED VOLATILITY: The volatility which must be attributed to an underlying price in order to make the theoretical values of an option or a spread equal to its current market price. IN THE MONEY: An option is in the money when it has intrinsic value. A call is in the money when the market price…
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