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Fundamentals: Derivatives

Calls and Puts: Put-call Parity – Options Basics

Put-call parity allows investors to protect their position in down markets through arbitrage techniques that sometimes come up in very illiquid markets. Calls, puts, short positions and long positions in…

December 26, 2014
3 mins Read

Fundamentals: Derivatives

Volatility and Time: Factors Affecting Option Premium

It is essential that people can make informed decisions about the opportunities derivatives present as well as the potential pitfalls. Volatility and time are two important factors affecting option premium…

Fundamentals: Derivatives

Interest Rate Swap: Curves and Cash Flows

An interest rate swap gives companies a way of managing their exposure to changes in interest rates. They also offer a way of securing lower interest rates. Examining An Interest…

Fundamentals: Derivatives

Risk Assessment Tools for Derivatives: Risk Management and Planning

Systems designed to manage derivatives trading and examining risk are widespread and ubiquitous. This article describes the methods involved in choosing risk assessment tools for derivatives trading and management. Risk…

Fundamentals: Derivatives

Derivative Concepts A to Z: Glossary of Terms

This page presents a derivative glossary of derivatives-related terminology that will make the other articles in the Financial Pipeline’s Derivatives section easier to understand, hopefully. It is not an exhaustive…

December 26, 2014
16 mins Read

Fundamentals: Derivatives

What is a Derivative?

What is a derivative? A derivative is a useful way of hedging risk. They come in a variety of types, but futures contracts, forward contacts, options and swaps are the…