Option Markets and Contracts III
About the Lecture
The lecture Option Markets and Contracts III by Edu Pristine is from the course Archiv - Derivatives. It contains the following chapters:
- Interest Rate Caps
- Interest Rate Floor
- Interest Rate Collars
- Payoffs of Options
- Minimum and Maximum value of European and American Options
- Minimum Price of In-the-Money Options
- Further on Lower Bounds - Call
- Further on Lower Bounds - Put
Author of lecture Option Markets and Contracts III
Edu Pristine
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Excerpts from the accompanying material
... endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ...
... CFA ® and Chartered Financial Analyst ® are trademarks owned by CFA Institute. ...
... Which have expiration dates corresponding to the reset dates of a floating rate loan Protects a floating rate buyer against an increase in interest rates Each component call option called a caplet Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ...
... CFA ® and Chartered Financial Analyst ® are trademarks owned by CFA Institute. ...
... Protects a floating rate lender against a decrease in interest rates. Each component put is a floorlet. Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ...
... CFA ® and Chartered Financial Analyst ® are trademarks owned by CFA ...
... If their premiums offset each other, it is called a Zero-Cost Collar. Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ...
... The LOS are the sole property of the CFA Institute. ...
... The LOS are the sole property of the CFA Institute. Amit has a taken a floating rate loan and is worried about the rising interest rates. ...
... if the interest rate rise above the cap she has to pay a fixed interest rate. ...
... Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ...
... lower limit on the interest payments that are received by the lender. Hence the third statement is false. Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ...
... rate options differ from other types of options. Calculate and interpret option payoffs ...
... Example: XYZ bought a 30-day call option on a 120-day LIBOR. The notional principal is $ 1,00,000 and the strike rate is 6%. If the 120-day LIBOR on expiry is 7% on expiry of the option contract what is the payof f to XYZ. Solution: Interest Saved = (0.07 - 0.06) (1,00,000) (120/360) = $333.33. But this amount will be received after 120 days ...
... The LOS are the sole property of the CFA Institute ...
... Disclaimer:CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. CFA Institute, CFA ® and Chartered Financial Analyst ® are trademarks owned by CFA Institute. The LOS are the sole property of the CFA Institute. ...
... Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ....
... Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. CFA Institute, CFA ® and Chartered Financial Analyst ® are trademarks owned by CFA Institute. ...
... Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered ...
... Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products ...
... Disclaimer: CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by Pristine. ...
