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Options and Futures

Call

An option contract grants the holder the privilege to purchase the underlying security at a predetermined price within a specified time frame. This allows the holder to benefit from potential price fluctuations without being obligated to exercise the option. It is a flexible tool used in financial markets to manage risk and maximize profits. Understanding the different types of options and their implications is crucial in making informed investment decisions. Let's dive deeper into the world of options and explore their significance in the realm of finance.

Linkage

The concept of arbitrage, or the practice of buying and selling contracts on different exchanges, is a common strategy in the world of finance. For example, one may buy a co...

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Price Limit

In the world of finance, we often come across terms such as "maximum advance" or "decline" in relation to trading contracts. These terms refer to the limit set by the exchan...

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U.S. Treasury Note

A government-debt security is a financial instrument that is issued by the government to raise funds. It typically has a maturity period of one to 10 years and pays a fixed ...

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National Futures Association (NFA)

The NFA, or National Futures Association, is a self-regulatory organization that oversees futures and options markets. Its main objectives include maintaining ethical standa...

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