List of Derivatives Articles

Theta options are defined as an options greek that measures the rate at which the option loses its time value as the expiration date draws near.

A ratio spread is a neutral options trading strategy in which an options trader holds an unequal number of long (purchased) and short (written) options contracts.

In the financial markets, leverage is used extensively to increase the potential return on investment. Leverage involves using borrowed capital or securities to fund a financial asset.

Index Options are derivative instrument, which means their value is derived from the movements in the underlying index.

When talking to an investor, you get to know that they lost all of their capital while trading. Thinking that they too would lose their capital, they pass on their idea of investing, thereby losing on huge wealth multiplication and profits.

One of the most common term you get to year in the derivatives market is the term “Underlying Asset”.

Currency options are a low upfront cost method of participating in the currency derivatives market. Like currency futures, currency options are also available on pairs like the USDINR, EURINR, GBPINR etc.

Derivative trading is one of the most rewarding asset classes for investors who have allocated some capital into equities. Professional investors choose Options contracts within derivatives to ensure they remain liquid and make profits in almost every market situation.

Theta options are defined as an options greek that measures the rate at which the option loses its time value as the expiration date draws near.

Basis in derivatives is the difference between the spot price (current price) and the strike price (predefined price) of the futures contract.

A bull put spread is an options trading strategy in which the trader buys and sells the same number of put options of different strike prices with the same underlying asset and expiration date.

A ratio spread is a neutral options trading strategy in which an options trader holds an unequal number of long (purchased) and short (written) options contracts.

In the financial markets, leverage is used extensively to increase the potential return on investment. Leverage involves using borrowed capital or securities to fund a financial asset.

An index is a benchmark like the Nifty or the Sensex. Typically, indices can be generic benchmarks like Nifty and Sensex. Alternatively, indices can also be thematic benchmarks like the Bank Nifty, Nifty IT etc.

Swaptions (Swap + options) is a derivative financial instrument with a swap as the underlying. One party called the writer or seller of the option gives another party called the holder or buyer of the option the right to exchange interest rates.