Option
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Delayed Rate Setting Swaps: Definition & How They Work
What Is a Delayed Rate Setting Swap? The term delayed rate setting swap refers to a type of derivative contract that starts immediately but whose coupon is set at a future date. A delayed rate
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Balloon Options: Understanding and Leveraging Increased Leverage
What Is a Balloon Option? A balloon option is a contract where the strike price increases significantly after the underlying assets price reaches a predetermined threshold. A balloon option inc
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Arrears Swap Explained: Interest Rate Swap with Retroactive Payments
What Is an Arrears Swap? An arrears swap is an interest rate swap that is similar to a regular, or plain vanilla swap, but the floating payment is based on the interest rate at the end of the r
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Understanding Forward Contracts: A Key to Derivatives
The most complex type of investment products often fall under the broad category of derivative securities. For most investors, the derivative instrument concept is hard to understand. However, since
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CFD vs. Spread Betting: A Comprehensive Guide to Market Leverage
Brief Overview Investments in financial markets can reap large rewards. However, traders cannot always access the capital necessary to get significant returns. Leveraged products offer investor
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Understanding Market Neutrality: Strategies for Consistent Returns
What Is Neutral? Neutral describes a position taken in a market that is neither bullish nor bearish. In other words, it is insensitive to the direction of the markets price. If an investor has
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Understanding Mismatch Risk: Causes, Examples & Mitigation
What Is Mismatch Risk? Mismatch risk has a number of particular definitions in finance, but with each basically referring to the chance that a loss can arise from an incompatibility between two
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OPRA: Understanding Options Price Reporting & Data Dissemination
What Is the Options Price Reporting Authority (OPRA)? The Options Price Reporting Authority (OPRA) is a committee of representatives from participating securities exchanges responsible for prov
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Swap Banks: Facilitating Interest Rate & Currency Swaps | [Your Company Name]
What Is a Swap Bank? A swap bank is an institution that acts as a broker between two counterparties who wish to enter into an interest rate or currency swap agreement and possibly remain anonym
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Cashless Conversion Explained: A Comprehensive Guide
What Is a Cashless Conversion? A cashless conversion is the direct conversion of ownership, from one type of security to another, without any initial cash outlay by the holder. For instance, th
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Understanding Rolling Hedges: A Risk Management Strategy
What is a Rolling Hedge A rolling hedge is a strategy for reducing risk that involves obtaining new exchange-traded options and futures contracts to replace expired positions. In a rolling
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Understanding STRATS: Structured Repackaged Asset-Backed Trust Securities
What Is a Structured Repackaged Asset-Backed Trust Security (STRATS)? A structured repackaged asset-backed trust security (STRATS) is a derivative product that pays an income stream to the hold
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STRIPE: Understanding Interest Rate Risk Hedging with Participating Elements
What Is a Swap Transferring Risk With Participating Element (STRIPE)? A swap transferring risk with participating element, or STRIPE, is a type of hedging instrument that combines an inter
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Derivatives DTEF: Understanding Transaction Execution Facilities
What Is a Derivatives Transaction Execution Facility (DTEF)? A derivatives transaction execution facility (DTEF) is a market that focuses on supporting the transaction of derivatives limited to
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Italian Derivatives Market (IDEM) - Futures Contracts & Trading
What Is the Italian Derivatives Market? The Italian Derivatives Market (IDEM) is a derivatives exchange headquartered in Milan, Italy. The IDEM is part of the Borsa Italiana, the Italian Stock
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Understanding the Risks of Mortgage-Backed Securities (MBS)
A mortgage-backed security (MBS) is a type of asset-backed security that is secured by a mortgage or collection of mortgages. An MBS can be traded through a broker. It is issued by ei
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Asset-Backed CDS (ABCDS): Definition & How They Work
What is an Asset-Backed Credit Default Swap? An asset-backed credit default swap (ABCDS) is a credit default swap (CDS) wherein the reference asset is the asset-backed security rather than a co
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Spread Betting Strategies: A Comprehensive Guide (UK Focus)
What Is Spread Betting? Among the many opportunities to trade, hedge or speculate in the financial markets, spread betting appeals to those who have substantial expertise in identifying price m
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Derivative Product Company (DPC): Definition & Role in Finance
What Does Derivative Product Company Mean? A derivative product company is a special-purpose entity created to be a counterparty to financial derivative transactions. A derivative product
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Interest Rate Swaps: Benefits and Advantages for Businesses
At their core, interest rate swaps are a derivative instrument built on the premise of comparative advantage. To see how interest rate swaps benefit both parties, try to understand gains f
Option
- Put-Call Parity Explained: Understanding the Relationship
- Understanding Leads and Lags in International Trade: A Comprehensive Guide
- Spread Betting Strategies: A Comprehensive Guide (UK Focus)
- Understanding Basket Options: A Comprehensive Guide
- Understanding Rolling Hedges: A Risk Management Strategy
- Rainbow Options: Understanding the Strategy & Investment Potential
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Stimulus Money: Smart Ways to Invest When You Don't Need ItDon't need your stimulus to pay...
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Create Effective Network Diagrams: A Comprehensive GuideNetwork diagrams give you a birds eye view of complicated relationships. A network diagram illustrates the relationships between different objects. In personal finance or business, for exampl...
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DIY Cold-Weather Cat Shelter: Build a Warm & Safe HavenOutdoor cats need a warm shelter during the cold winter months. Cats that live outdoors in cold climates need protection during the chilly winter months. Whether you have a pet cat that prefe...
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Flexible Spending Accounts (FSAs): Contribution Limits & BenefitsFlexible spending accounts, or FSAs, are tax-advantaged accounts that your employer can set up to help you pay for either health care or dependent care expenses with pre-tax dollars. Your employer doe...