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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.

Bull Spread

Let's dive into the concept of Bull Spread, a strategy commonly used by options traders to capitalize on a predicted increase in the price of the underlying asset. This stra...

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Deliverable Grades

Futures contracts are an essential tool for traders in the financial market. As a knowledgeable professor of finance, it is important to understand the concept of a futures ...

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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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Holder (Option Buyer)

The holder, also known as the owner, of an option contract possesses the privilege to exercise the option within its duration. This privilege is acquired by the holder throu...

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