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SPAN Margin

Let's delve into the world of finance and explore the concept of initial margin for the F&O segment. This margin is not calculated on an individual basis, but rather on a portfolio approach. To perform this calculation, we use a software called SPAN® (Standard Portfolio Analysis of Risk). This powerful tool generates 16 different scenarios by adjusting price and volatility values. It then determines the potential loss the portfolio could face in each scenario. This allows us to make informed decisions and manage risk effectively in the F&O segment.

Extrinsic Value

The intrinsic value is the inherent value of an option determined by its underlying asset's current price. This means that the extrinsic value is influenced by factors such a...

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Exposure Margin

As we continue our exploration of the fascinating world of finance, let's delve deeper into the concept of exposure margin in the F&O segment. This margin serves as an addit...

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Expiration Time

This date is determined by the exchange on which the contract is traded. When we talk about expiration time in the context of finance, we are referring to the specific date ...

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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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