FINANCE 6100 SUU EXAM 3 Latest Update with complete Solutions
FINANCE 6100 SUU EXAM 3 Latest Update with
complete Solutions
Define call - ✔-Buy at prearranged price by set date, prices rises
Define put - ✔-Sell at prearranged price by set date, price falls
Call - exercise (strike) price - ✔-Fixed price X
Call - expiration (maturity) date - ✔-Certain date T
Call - option premium - ✔-Price paid by buyer to seller to obtain right
Put - exercise (strike) price - ✔-Fixed price
Put - expiration (maturity) date - ✔-Certain date
Put - option premium - ✔-Price paid by buyer to sell to obtain right
Long the contract - ✔-Right to exercise option or not, pay premium to other person to buy the right
Short the contract - ✔-You are paid to accept risk if other exercises and you trade asset
In the money - ✔-Today for positive gain
Positive intrinsic value
Out the money - ✔-Not today
0 intrinsic value
FINANCE 6100 SUU EXAM 3 Latest Update with complete Solutions
, FINANCE 6100 SUU EXAM 3 Latest Update with complete Solutions
Option premium: Intrinsic value - ✔-Payoff sold right now
Option premium: Time value - ✔-Extra value with remaining time for option expiration
American - ✔-Any time until maturity date
European - ✔-Only on maturity date
Future price - ✔-Contract call for delivery of commodity at specified delivery or maturity date
Long position - ✔-Trader commits to purchasing commodity on date
Short position - ✔-Trader commits to delivering commodity at contract maturity
Profit to long - ✔-Spot price at maturity - original future price
Profit to short - ✔-Original future price - spot price at maturity
Spot price - ✔-Actual market price of commodity
Corporate hedging process - ✔-Identify risks
Difference of hedging and speculating
Cost of hedging with light of cost or not
Right measurement to evaluate hedge performance
Dont base on market view
Understand tools
System of controls
FINANCE 6100 SUU EXAM 3 Latest Update with complete Solutions
FINANCE 6100 SUU EXAM 3 Latest Update with
complete Solutions
Define call - ✔-Buy at prearranged price by set date, prices rises
Define put - ✔-Sell at prearranged price by set date, price falls
Call - exercise (strike) price - ✔-Fixed price X
Call - expiration (maturity) date - ✔-Certain date T
Call - option premium - ✔-Price paid by buyer to seller to obtain right
Put - exercise (strike) price - ✔-Fixed price
Put - expiration (maturity) date - ✔-Certain date
Put - option premium - ✔-Price paid by buyer to sell to obtain right
Long the contract - ✔-Right to exercise option or not, pay premium to other person to buy the right
Short the contract - ✔-You are paid to accept risk if other exercises and you trade asset
In the money - ✔-Today for positive gain
Positive intrinsic value
Out the money - ✔-Not today
0 intrinsic value
FINANCE 6100 SUU EXAM 3 Latest Update with complete Solutions
, FINANCE 6100 SUU EXAM 3 Latest Update with complete Solutions
Option premium: Intrinsic value - ✔-Payoff sold right now
Option premium: Time value - ✔-Extra value with remaining time for option expiration
American - ✔-Any time until maturity date
European - ✔-Only on maturity date
Future price - ✔-Contract call for delivery of commodity at specified delivery or maturity date
Long position - ✔-Trader commits to purchasing commodity on date
Short position - ✔-Trader commits to delivering commodity at contract maturity
Profit to long - ✔-Spot price at maturity - original future price
Profit to short - ✔-Original future price - spot price at maturity
Spot price - ✔-Actual market price of commodity
Corporate hedging process - ✔-Identify risks
Difference of hedging and speculating
Cost of hedging with light of cost or not
Right measurement to evaluate hedge performance
Dont base on market view
Understand tools
System of controls
FINANCE 6100 SUU EXAM 3 Latest Update with complete Solutions
