imported>Doug Williamson |
imported>Doug Williamson |
| Line 1: |
Line 1: |
| 1.
| | An inquiry established by the European Parliament to investigate money laundering, tax avoidance and tax evasion, following the Panama Papers disclosures of 2016. |
| | |
| A financial option is a derivative instrument giving the holder the right - but not the obligation - to buy or sell an underlying asset on or before a future date at a specified price.
| |
| | |
| Options are more commonly ‘cash settled’ by paying or receiving a net cash amount, rather than being settled by physical delivery of the underlying asset.
| |
| | |
| | |
| Like other derivative instruments, options can be used to:
| |
| | |
| • Speculate by creating new exposures to market rates.
| |
| | |
| • Hedge existing exposures to changes in market rates.
| |
| | |
| • Arbitrage in combination with other related instruments to achieve 'risk free' profits.
| |
| | |
| | |
| When used for hedging purposes, options generally provide insurance-like protection against worst case outcomes. (Contrasted with 'fixing' hedging instruments - such as FRAs - which effectively fix the market rate being hedged.)
| |
| | |
| | |
| 2.
| |
| | |
| More generally, choice.
| |
| | |
| | |
| 3.
| |
| | |
| A real option is an option relating to an operational decision or outcome.
| |
|
| |
|
|
| |
|
| == See also == | | == See also == |
| * [[American-style option]] | | * [[Anti-avoidance provision]] |
| * [[Asian option]]
| | * [[European Parliament]] |
| * [[Barrier option]]
| | * [[Panama Papers]] |
| * [[Binomial option pricing model]]
| | * [[Paradise Papers]] |
| * [[Black Scholes option pricing model]]
| | * [[Tax evasion]] |
| * [[Call option]]
| | * [[Tax haven]] |
| * [[Cash settlement]]
| |
| * [[Delta]]
| |
| * [[Derivative instrument]]
| |
| * [[European-style option]] | |
| * [[Exercise]]
| |
| * [[Exotic option]]
| |
| * [[Fixing]]
| |
| * [[Fixing instrument]]
| |
| * [[Foreign exchange forward contract]]
| |
| * [[Futures contract]]
| |
| * [[Greeks]]
| |
| * [[Hedging]]
| |
| * [[Insurance]]
| |
| * [[Interest rate guarantee]]
| |
| * [[Interest rate option]]
| |
| * [[Outright]]
| |
| * [[Payoff]]
| |
| * [[Put option]]
| |
| * [[Put-call parity theory]]
| |
| * [[Real option]]
| |
| * [[Straddle]]
| |
| * [[Strike price]]
| |
| * [[Swaption]]
| |
| * [[Traded option]]
| |
| * [[Underlying asset]] | |
| * [[Underlying price]] | |
| * [[Volatility index]] | |
| * [[Warrant]] | |
| | |
| [[Category:Manage_risks]]
| |
