Let's say you bought a share @ 500 & if the share price goes beyond 500, you will gain but you are afraid of share price falling as you'll have loss. So for that you bought a OTM put option at a strike price say 480 @ 45. So whenever the share price falls below 480 you will gain coz of putRead more
Let’s say you bought a share @ 500 & if the share price goes beyond 500, you will gain but you are afraid of share price falling as you’ll have loss. So for that you bought a OTM put option at a strike price say 480 @ 45. So whenever the share price falls below 480 you will gain coz of put & whenever share price goes beyond 500 you will gain coz you have the share in your hand. But what about if it remains in b/w 480 – 500, here nobody are going to save you. This is deductible which you have to bear. So now if you look closely the max loss which you will bear will be this deductible amount + put premium which you had paid at the time of purchasing the put option.
The answer which you have given is of the calendar spread. Moreover in the reverse calendar spread there is a bearish outlook not bullish. Also when we do the calendar spread or reverse calendar spread we take different maturity with the same stock at the same strike price. But here in your answerRead more
The answer which you have given is of the calendar spread. Moreover in the reverse calendar spread there is a bearish outlook not bullish. Also when we do the calendar spread or reverse calendar spread we take different maturity with the same stock at the same strike price. But here in your answer the strike price are also different.
But how high quality bond is Rf + credit spread as if we buy a high quality bond (say AAA, AA, etc) their credit ratings are already high so why will anybody want a credit spread for buying such sort of bonds? Please clear this.
But how high quality bond is Rf + credit spread as if we buy a high quality bond (say AAA, AA, etc) their credit ratings are already high so why will anybody want a credit spread for buying such sort of bonds? Please clear this.
You are forgetting the logic of computing the sum. The logic was :- (1) What you are earning in a foreign country (2) is there foreign currency appreciating/depreciating - accordingly we'll take that too as we gain/loose when foreign currency appreciates/depreciates (3) The impact of foreign currencRead more
You are forgetting the logic of computing the sum. The logic was :-
(1) What you are earning in a foreign country
(2) is there foreign currency appreciating/depreciating – accordingly we’ll take that too as we gain/loose when foreign currency appreciates/depreciates
(3) The impact of foreign currency on our foreign portfolio return i.e if the foreign currency appreciates then we’ll have the positive impact on our foreign portfolio return which means we’ll gain extra through that also. So we’ll take this component as well while computing RDC.
Conclusion :- That’s the reason why they have done 12+5-2.
I think there the disclosure is not needed as the analyst do not deal directly with the client but if it would have been an investment advisor/portfolio manager then that disclosure would have been mandatory
I think there the disclosure is not needed as the analyst do not deal directly with the client but if it would have been an investment advisor/portfolio manager then that disclosure would have been mandatory
Swaps, forwards & futures Strategies
Ok thanks
Ok thanks
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Yes you are right, I didn't read that carefully that time. Thanks.
Yes you are right, I didn’t read that carefully that time. Thanks.
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Let's say you bought a share @ 500 & if the share price goes beyond 500, you will gain but you are afraid of share price falling as you'll have loss. So for that you bought a OTM put option at a strike price say 480 @ 45. So whenever the share price falls below 480 you will gain coz of putRead more
Let’s say you bought a share @ 500 & if the share price goes beyond 500, you will gain but you are afraid of share price falling as you’ll have loss. So for that you bought a OTM put option at a strike price say 480 @ 45. So whenever the share price falls below 480 you will gain coz of put & whenever share price goes beyond 500 you will gain coz you have the share in your hand. But what about if it remains in b/w 480 – 500, here nobody are going to save you. This is deductible which you have to bear. So now if you look closely the max loss which you will bear will be this deductible amount + put premium which you had paid at the time of purchasing the put option.
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The answer which you have given is of the calendar spread. Moreover in the reverse calendar spread there is a bearish outlook not bullish. Also when we do the calendar spread or reverse calendar spread we take different maturity with the same stock at the same strike price. But here in your answerRead more
The answer which you have given is of the calendar spread. Moreover in the reverse calendar spread there is a bearish outlook not bullish. Also when we do the calendar spread or reverse calendar spread we take different maturity with the same stock at the same strike price. But here in your answer the strike price are also different.
Sir can you please help me in this?
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But how high quality bond is Rf + credit spread as if we buy a high quality bond (say AAA, AA, etc) their credit ratings are already high so why will anybody want a credit spread for buying such sort of bonds? Please clear this.
But how high quality bond is Rf + credit spread as if we buy a high quality bond (say AAA, AA, etc) their credit ratings are already high so why will anybody want a credit spread for buying such sort of bonds? Please clear this.
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Ok
Ok
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Ok
Ok
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OK thank you!
OK thank you!
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You are forgetting the logic of computing the sum. The logic was :- (1) What you are earning in a foreign country (2) is there foreign currency appreciating/depreciating - accordingly we'll take that too as we gain/loose when foreign currency appreciates/depreciates (3) The impact of foreign currencRead more
You are forgetting the logic of computing the sum. The logic was :-
(1) What you are earning in a foreign country
(2) is there foreign currency appreciating/depreciating – accordingly we’ll take that too as we gain/loose when foreign currency appreciates/depreciates
(3) The impact of foreign currency on our foreign portfolio return i.e if the foreign currency appreciates then we’ll have the positive impact on our foreign portfolio return which means we’ll gain extra through that also. So we’ll take this component as well while computing RDC.
Conclusion :- That’s the reason why they have done 12+5-2.
Hope this helped!
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I think there the disclosure is not needed as the analyst do not deal directly with the client but if it would have been an investment advisor/portfolio manager then that disclosure would have been mandatory
I think there the disclosure is not needed as the analyst do not deal directly with the client but if it would have been an investment advisor/portfolio manager then that disclosure would have been mandatory
See less