Template:Nutshell Equity Derivatives 3.4: Difference between revisions

← Older edit

Template:Nutshell Equity Derivatives 3.4 (view source)

Revision as of 12:12, 13 May 2022

704 bytes removed , 13 May 2022

no edit summary

Amwelladmin

Bureaucrats, Interface administrators, Administrators

83,307

edits

@@ Line 1: / Line 1: @@
-Section {{eqderivprov|3.4}}. '''{{eqderivprov|Automatic Exercise}}'''. If “'''{{eqderivprov|Automatic Exercise}}'''” applies to an {{eqderivprov|Option Transaction}} then (unless, by the {{eqderivprov|Expiration Time}} on the {{eqderivprov|Expiration Date}} {{eqderivprov|Buyer}} notifies {{eqderivprov|Seller}} that {{eqderivprov|Automatic Exercise}} should not occur) each unexercised {{eqderivprov|Option}} will be automatically exercised: <br>
+{{eqderivprov|3.4}}. '''{{eqderivprov|Automatic Exercise}}'''. If “'''{{eqderivprov|Automatic Exercise}}'''” applies to an {{eqderivprov|Option Transaction}} then (unless, by the {{eqderivprov|Expiration Time}} on the {{eqderivprov|Expiration Date}} {{eqderivprov|Buyer}} notifies {{eqderivprov|Seller}} that {{eqderivprov|Automatic Exercise}} should not occur) each unexercised {{eqderivprov|Option}} will be automatically exercised: <br>
 :{{eqderivprov|3.4(a)}} '''{{eqderivprov|Cash Settlement}}''': at the {{eqderivprov|Expiration Time}} on the {{eqderivprov|Expiration Date}}; and <br>
 :{{eqderivprov|3.4(b)}} '''{{eqderivprov|Physical Settlement}}''': if the {{eqderivprov|Calculation Agent}} determines the {{eqderivprov|Option}} to be {{eqderivprov|In-the-Money}} at such time, as at the {{eqderivprov|Expiration Time}} on the {{eqderivprov|Expiration Date}}.
-:{{eqderivprov|3.4(c)}} “'''{{eqderivprov|In-the-Money}}'''” means
+:{{eqderivprov|3.4(c)}} “'''{{eqderivprov|In-the-Money}}'''” means:
-::(i) for a {{eqderivprov|Call}}, that
+::(i) '''For a {{eqderivprov|Call}}''': That the {{eqderivprov|Reference Price}} at least equals the price at which a {{eqderivprov|Related Exchange}} would automatically exercise a {{eqderivprov|Physically-settled}} option on that {{eqderivprov|Share}} with that {{eqderivprov|Strike Price}} or, if there are no listed options on that {{eqderivprov|Share}} or there is no {{eqderivprov|Related Exchange}}, the {{eqderivprov|Reference Price}} exceeds the {{eqderivprov|Strike Price}}; and
-:::(A) the {{eqderivprov|Reference Price}} is equal to or greater than the price for a {{eqderivprov|Share}} at which any {{eqderivprov|Related Exchange}} would automatically exercise a {{eqderivprov|Physically-settled}} option with the {{eqderivprov|Strike Price}} relating to such {{eqderivprov|Share}}, or
+::(ii) '''For a {{eqderivprov|Put}}''': That the {{eqderivprov|Reference Price}} is no greater than the price at which a {{eqderivprov|Related Exchange}} would automatically exercise a {{eqderivprov|Physically-settled}} option on that {{eqderivprov|Share}} with that {{eqderivprov|Strike Price}} or, if there are no listed options on that {{eqderivprov|Share}}, or there is no {{eqderivprov|Related Exchange}}, the {{eqderivprov|Reference Price}} is less than the {{eqderivprov|Strike Price}}); and
-:::(B) if no options relating to such {{eqderivprov|Share}} are listed on any {{eqderivprov|Related Exchange}} or no {{eqderivprov|Related Exchange}} is specified in the related {{eqderivprov|Confirmation}}, the Reference Price is greater than the {{eqderivprov|Strike Price}}; and
+:{{eqderivprov|3.4(d)}} “'''{{eqderivprov|Reference Price}}'''” means the price per {{eqderivprov|Share}} or per {{eqderivprov|Basket}} determined as of the {{eqderivprov|Expiration Time}} on the {{eqderivprov|Expiration Date}} and, if no means of determining such price or amount are provided, that will be:
-::(ii) in respect of a {{eqderivprov|Put}}, that
+::(i) '''For a {{eqderivprov|Share Option Transaction}}''': The {{eqderivprov|Relevant Price}} of the {{eqderivprov|Share}}
-:::(A) the {{eqderivprov|Reference Price}} is equal to or less than the price for a {{eqderivprov|Share}} at which any {{eqderivprov|Related Exchange}} would automatically exercise a {{eqderivprov|Physically-settled}} option with the {{eqderivprov|Strike Price}} relating to such {{eqderivprov|Share}}, or
+::(ii) '''For a {{eqderivprov|Share Basket Option Transaction}}''':the sum of the values for each {{eqderivprov|Share}} in the {{eqderivprov|Basket}} determined as its {{eqderivprov|Relevant Price}} multiplied by its {{eqderivprov|Number of Shares}} (in either case, using the {{eqderivprov|Valuation Time}} and {{eqderivprov|Valuation Date}} as the {{eqderivprov|Expiration Time}} and {{eqderivprov|Expiration Date}})
-:::(B) if no options relating to such {{eqderivprov|Share}} are listed on any {{eqderivprov|Related Exchange}} or no {{eqderivprov|Related Exchange}} is specified in the related {{eqderivprov|Confirmation}}, the {{eqderivprov|Reference Price}} is less than the {{eqderivprov|Strike Price}}.
-:{{eqderivprov|3.4(d)}} “'''{{eqderivprov|Reference Price}}'''” means the price per {{eqderivprov|Share}} or amount per {{eqderivprov|Basket}} determined as provided in the related {{eqderivprov|Confirmation}} as of the {{eqderivprov|Expiration Time}} on the {{eqderivprov|Expiration Date}} or, if no means of determining such price or amount are so provided, in respect of a {{eqderivprov|Share Option Transaction}}, the {{eqderivprov|Relevant Price}} of the Share (for which purpose the {{eqderivprov|Valuation Time}} and the {{eqderivprov|Valuation Date}} will be the {{eqderivprov|Expiration Time}} and the {{eqderivprov|Expiration Date}}, respectively) and, in respect of a {{eqderivprov|Share Basket Option Transaction}}, the sum of the values calculated as of the {{eqderivprov|Expiration Time}} on the {{eqderivprov|Expiration Date}} for the {{eqderivprov|Shares}} of each {{eqderivprov|Issuer}} as the product of the {{eqderivprov|Relevant Price}} of such Share (for which purpose the {{eqderivprov|Valuation Time}} and the {{eqderivprov|Valuation Date}} will be the {{eqderivprov|Expiration Time}} and the {{eqderivprov|Expiration Date}}, respectively) and the relevant {{eqderivprov|Number of Shares}} comprised in the {{eqderivprov|Basket}}. <br>