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Derivatives

Convergence

It is an essential concept in financial markets.

As we dive into the world of finance, it's important to understand the concept of convergence. This term refers to the gradual alignment of the futures contract's price with the spot or cash price of the underlying securities. In simpler terms, it's the process of closing the gap between the two prices over time. This plays a crucial role in the functioning of financial markets, making it a fundamental concept to grasp.

Equity Options

They give the holder the right, but not the obligation, to buy or sell the underlying shares at a specific price on or before the expiration date. In the world of finance, t...

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Expiration Date

The option expiration date marks the end of an option's validity and is a crucial factor in the decision-making process for traders. It serves as the deadline for exercising...

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Intrinsic Value of an Option

This value is important to consider when making investment decisions. Understanding the concept of intrinsic value in the world of finance is crucial for making informed inv...

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Put Option

This allows them to sell the stock at a higher price, making a profit. On the other hand, a call option gives the holder the right to buy a stock at a stated price within a f...

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