Industry analysis means to analyze the whole industry in which different companies relating to a single industry would be dominated, analyzed and count. Though there are number of industries currently found in the entire world and every industry has its own recognition and importance in a broad nutshell. Among number of things that come under the ambit of finance, the name of derivatives is one of them. There are different things that stride under the ambit of derivatives, like SWAP, options and forward contracts (You-lan Zhu 2004). The main perspective of this assignment is to analyze different options accordingly. Two of the questions mentioned in the case study are all about Plain Vanilla Swaps and there are two different options which have been taken into consideration for the same in total. Ans-1) European Options Option-1 K1 = 1.00 Option-2 K2 = 0.75 Option-3 K3 = 0.15 An option that can only be exercised at the end of its life, at its maturity is called European Option. European options tend to sometimes trade at a discount to its comparable American option. This is because American options allow investors more opportunities to exercise the contract. From the analysis, it is clear that the price of Option 1 is comparatively higher than that of K2 and K3 in total. An investor who buys the options on the price K1 would get loss when it moves to a place of K2 and K3 but when it is Short sell on the level of K1 then profit could be gain accordingly. The payoffs of all the options are showing that the investor would be found accordingly. Ans-2) Portfolio Buy or Sell? Amount Option-1 Sell 1$ Option-2 Buy 0.75 Option-3 Buy 0.15 It is possible to earn profit on the options accordingly. If the option-3 could be buying from a market and then sell it in the market where option 1 is trading then the chance of earning would be on a higher place. This particular strategy would be quite authentic and perfect from the standpoint of this analysis and it could be given in the same figure. References You-lan Zhu, Xiaonan Wu, I-Liang Chern. Derivative Securities and Difference Methods. Taipei: Springer,
Introduction Accounting and finance always define somewhat different things in total because the applicability of the same could not be matched with any other thing (Beasley, M et al. 2009). Accounting is the name of recording and interpreting the data from different standpoints and there are numerous things that come under the ambit of the same…
The object of analysis for the purpose of this assignment are derivatives as a particular instrument or product the worth of which is obtained as a resultant of more than one fundamental variables referred to as an underlying asset, value associated with the reference rate and index by way of a contract.
Marketing is used to create, to keep and to satisfy the customer. It can be concluded that Marketing is one of the premier components of Business Management - the other being Innovation. Other services and management activities such as Operations, Human Resources, Accounting, Law and Legal aspects can be "bought in" or "contracted out".
GARCH effectively helps in analyzing this gap between risk and return and provides an in-depth analysis over asset pricing, portfolio optimization, option pricing and risk management (Christian Francq, 2011). GARCH model work on the assumption that randomness of the variance process fluctuates in accordance with the variance and not per its square root i.e (Chance & Brooks, 2009.
The investors take diversified investment strategy, where they invest their money in national as well as international investment instruments. Here the researcher tends to analyse the key mechanism of international investment diversification. The diversification process in their investments consist of different types of activities viz.
It explains an existing interrelation between economic development and assets value. If we analyze any specific asset, for example stocks of a joint-stock company, we can surely emphasize, that economic successes of this company, its marketing divisions influence the price behavior.
These models serve as a means of summarizing and exposing the mortgage contracts which are complex in nature. The models also explain the implicit options the mortgage contracts contain for borrowers. One of such options is to terminate the contract prior to maturity.
The longer the term of the interest rates the higher the interest rates will be as in comparison to short term interest rates which are mostly lower than the long term interest rates.
Yield curve analysis is considered as one of the most valuable bond
Facebook users chose on categories to join depending on age, location and also interest. The main source of revenue for facebook simply depends on advertisement and also creation of application. Logging into facebook requires one to log in
Among the many financial tools employed include debt financing, the use of financial derivatives and speculating on financial tools. The use of these tools comes with many economical advantages and also adverse sides if misused. It is