82,853
edits
Equity derivative: Difference between revisions
no edit summary
Amwelladmin (talk | contribs) No edit summary |
Amwelladmin (talk | contribs) No edit summary |
||
| Line 10: | Line 10: | ||
====Features==== | ====Features==== | ||
Equity derivatives generally reference the performance of the [[underlier]] over the life of the transaction, most commonly represented as a fraction whereby {{eqderivprov|Settlement Price}} (also known as "[[Final Price]]") is divided by "{{eqderivprov|Strike Price}}" (also known as | Equity derivatives generally reference the performance of the [[underlier]] over the life of the transaction, most commonly represented as a fraction whereby {{eqderivprov|Settlement Price}} (also known as "[[Final Price]]") is divided by "{{eqderivprov|Strike Price}}" (also known as “[[Initial Price]]”) to yield a percentage - anything greater than 100% implies a positive return over the life of the transaction; a figure of less than 100% implies a negative return. | ||
*'''{{eqderivprov|Strike Price}}''': generally the price of the underlier at the inception of the trade | *'''{{eqderivprov|Strike Price}}''': generally the price of the underlier at the inception of the trade | ||
*'''{{eqderivprov|Settlement Price}}''': generally the price of the underlier at the scheduled maturity of the trade | *'''{{eqderivprov|Settlement Price}}''': generally the price of the underlier at the scheduled maturity of the trade | ||