Sentences with phrase «variance of its underlying assets»

Not exact matches

There are no liquidity concerns, as you are not purchasing any underlying assets and platforms / brokers can create any number of different options which provides plenty of variance for traders to choose from.

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).

Secondly, the VIX is designed as a theoretical price, not an asset - this is advantageous in that it is quoted in units of the underlying asset, but volatility is much more expensive and difficult to hedge than variance.