Sentences with phrase «trading price of the underlying asset»

Options contracts are priced solely by the trading price of the underlying asset, so even if your multiple account trading could only at best break even when you sell your final holdings (basically resetting the price to where it was because you started distorting it), this is fine because your real trade is in the options market.

Not exact matches

While these CFDs, the underlying digital assets of which «have displayed very high price variation,» are not traded on public exchanges in the eurozone, their popularity in Europe has nonetheless grown over the last several years.

ETFs are subject to risks similar to those of stocks and trading prices may not reflect the actual net asset value of the underlying securities.

The GBTC trades like a closed - end - fund usually at a price that is substantially different than the value of the underlying asset, and does not possess the ability to create or redeem shares in the open market.

An ETF holds assets such as stocks, supplies, or bonds and trades at approximately the same price as the net asset value of its underlying assets over the course of the trading day.

Method of creating and trading derivative investment products based on a volume weighted average price of an underlying asset (Dennis O'Callahan, Catherine Shalen 2006)

For every investable asset — publically traded or otherwise — the underlying value of the asset is the sum of the discounted future cash flows, and risk comes from paying too high a price for those cash flows.

When you trade CFDs you're essentially speculating on the future price of the underlying asset, unlike traditional shares trading you don't physically own the asset.

Circuit breakers (trading halts) were triggered almost 1,300 times, and the prices of some popular exchange traded funds (ETFs) disconnected from their underlying assets.

In the case of the binary trading, except high or low options, the strike prices are set by the broker and even if you have a fair idea on how an underlying asset will behave, you can not place an order to be executed at certain price points.

The strategy allocates risk and leverage based on variance assuming stable correlations... The risk parity strategy, decomposed, is actually a portfolio of leveraged short correlation trades (alpha) layered on top of linear price exposure to the underlying assets (beta).

When the stock is trading at $ 65, suppose you decide to purchase the 62 XYZ Company October put option contract (i.e. the underlying asset is XYZ Company stock, the exercise price is $ 62, and the expiration month is October) at $ 3 per contract (this is the option price, also known as the premium) for a total cost of $ 300 ($ 3 per contract multiplied by 100 shares that the option contract controls).

Derivative trading involves a lot of arbitrage which brings about price corrections and thus help in reflecting the correct and true economic value and price of the underlying assets.

The value of a derivative depends on the value of its underlying asset, thus by predicting the future price of the asset, the future price of the derivative contract can be judged and traded on.

ETFs trade intraday (i.e. at any time during trading hours) and any time the price diverges too far from the underlying assets, one of the authorized participants has an incentive to make a small profit by creating or destroying units of the ETF, also intraday.

Mutual fund share value, known as net asset value NAV, is calculated and announced once at the end of the trading day based on share prices of a portfolio's underlying securities.

Share prices can deviate from the fund's net asset value of the underlying securities it holds, as market forces of supply and demand can lead to a trading discount or premium.

The shares of the Spain Fund, Inc., a closed - end mutual fund investing in publicly traded Spanish securities, were bid up in price from approximately net asset value (NAV)-- the combined market value of the underlying investments divided by the number of shares outstanding — to more than twice that level.

The Spain Fund priced at twice net asset value was another example of trading sardines; the only possible reason for buying the Spain Fund rather than the underlying securities was the belief that its shares would appreciate to an even more overpriced level.

Investing in commodities indices that are constructed using long or short positions in futures on physical commodities whose value is determined based on the price of the underlying physical commodity plus yield and that trade on public markets that provide adequate liquidity and transparency, with negligible costs and no storage deterioration risk, offer a practical method to gaining commodities exposure and can provide a means for market participants to access the five components of the returns of the asset class.

Index CFDs can be a valuable asset to your trading strategy as you can take advantage of the price fluctuations of underlying assets.

Investors trade on the price movement of financial assets (without actually owning the underlying asset).

One side effect of a «close - end» structure is that the LIC share price can depart from the value of the underlying assets (usually other equities), so the share price can trade at a premium or discount to its Net Tangible Aassets (usually other equities), so the share price can trade at a premium or discount to its Net Tangible AssetsAssets.

ETF providers use stocks» prices to calculate an ETF's intraday underlying value throughout the trading day, and the closing net asset value (NAV) of an equity ETF is typically very close to the ETF's closing price.

Mutual funds are typically purchased from and sold back to the investment company and priced at the end of the trading day, with the price determined by the net asset value (NAV) of the underlying securities.

When he inputs a derivative used as a hedge it allows the risk associated with the price of the underlying asset to be transferred between both parties involved in the contract being traded.

Because options contracts guarantee the right to trade an asset at a specific price for a certain period of time, their price depends in large part on the perceived value of the underlying security and the length of time before the option expires.

This settlement value depends on whether the price of the asset underlying the binary option is trading above or below the strike price by expiration.

Furthermore I believe that NAV is understated as it is based on prices of publicly traded shares that I feel do not fully reflect the underlying assets of these companies.

The creation and redemption mechanisms help ETF shares trade at a price close to the market value of their underlying assets.

Option prices move with the movement of the underlying so in theory I could simply trade the option itself without every needing (or wanting) to hold shares in the underlying asset.

While closed - end funds often trade at a premium or discount because they have a fixed number of shares outstanding, market makers work with authorized participants (APs) to strive to keep the price of ETF shares close to fair value (i.e., in line with the ETF's underlying net asset value (NAV)-RRB-.

These risks include the possibility that you will make trades without having all the information you need, or that you may trade CFDs at a price that doesn't reflect the value of the underlying asset.

The AP delivers a certain amount of underlying securities and receives the exact same value in ETF shares, priced based on their net asset value (NAV), not the market value at which the ETF happens to be trading.

ETF trading prices may not necessarily reflect the net asset value of the underlying securities.

An examination of trading volumes, net flows, bid - ask spreads, and relative price changes demonstrates that ETFs performed in line with their underlying assets.

If, on the other hand, the spread between a future traded on an underlying asset and the spot price of the underlying asset was set to widen, possibly due to a rise in short - term interest rates, then an investor would be advised to sell the spread (i.e. a calendar spread where the trader sells the near - dated instrument and simultaneously buys the future on the underlying).

This may occur, for example, at times of rapid price movement if the price for the underlying asset rises or falls in one trading session to such an extent that trading in the underlying asset is restricted or suspended.

Options trading is a form of derivative trading in which people trade contracts that give them the rights (but not obligation) to buy or sell an underlying asset at a predetermined price.

Trading of derivatives like futures also serves to move volatility away from the underlying asset and ultimately causes prices to become more predictable overall.

Finally, it is important to note that binary options do not trade on the actual price of the underlying asset.

«Ownership of virtual currency is very risky and full of speculation because there is no authority responsible,» the central banker continues, «there is no official administrator, there is no underlying asset underlying virtual currency price and trading value is very volatile so vulnerable to the risk bubble and prone to be used as a means of washing money and financing of terrorism, so that it can affect the stability of the financial system and harm the public.