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10 Cards in this Set
- Front
- Back
What are the difference between broad-based indeces and narrow-based?
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A narrow-based index measures the performance of a particular market segment whereas a broad-based measures stock that reflect the whole market
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What is the difference in exercising an index option versus an equity option?
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If the option is exercised there is no change of physical securities but instead the exercise results in a cash settlement
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Volatility Market Index Options
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Broad-based option calculated using the bid adn ask quotes of S&P index options. Weight both nearby and second nearby options that ahve at least eight days to expiration to produce a 30-day measure of volatility. |
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What is the expiration cycle for VIX options?
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VIX options expire on the Wednesday that is 30 days prior to the third Friday of the following calendar month
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Who regulates the foreign currency market?
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The Interbank Market establishes foreign currency rates
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What are spot and forward transactions?
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Spot transactions settle two business days after a trade of foreign currency while forward transactions settle in more than two days
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What are the six currencies on the Philadelphia Stock Exchange?
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Australian Dollar (XDA) British Pound (XDB) Canadian Dollar (XDC) Euro (XDE) Swiss Franc (XDS) Japanese Yen (XDN) -- sold in units of 1,000,000 |
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What yield-based options can be purchased?
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13-week treasury bills (IRX) Five-year treasury notes (FVX) 10-year treasury notes (TNX) 30-year treasury bonds (TYX) |
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How are yield-based options settled?
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They are settled on a cash basis with no physical delivery of securities
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If an investor believes interest rates will decline they should...
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Buy yield-based puts or sell yield-based calls
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