Options Margin
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1) For short equity options, the margin requirement is 20% of the underlying stock value plus the premium received, minus any out-of-the-money amount, with a minimum of 10% of the underlying value. 2) For call and put spreads, the margin requirement can be reduced or eliminated depending on the expiration and exercise prices of the long and short options. 3) For short straddles, the margin requirement is the greater of the two leg requirements plus the other leg's premium. 4) For foreign equity and index options, the margin requirement is generally 100% of the premium plus a percentage of the underlying value, minus any out-of-the-money amount or premium received.
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Introdaction of derivative marketAnkur Sarswat
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Derivatives are financial instruments whose value is dependent on an underlying asset. The three main types of derivatives are forwards, futures, and options. Forwards and futures are contracts to buy or sell an asset at a future date at a predetermined price, while options provide the right but not obligation to buy or sell an asset at a strike price. Derivatives allow traders to hedge risk, reduce transaction costs, manage portfolios, and enhance liquidity in markets.Chapter 10
Chapter 10Dr. Muath Asmar
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This document provides an overview of derivative securities markets based on a chapter from a textbook on financial markets and institutions. It defines derivatives and describes their main uses for hedging and speculation. It also outlines various types of derivative contracts including forwards, futures, options, swaps, and discusses the key characteristics and uses of these contracts. The document concludes with tables showing the size of various derivative markets from 1999 to 2016.Chapter (10)
Chapter (10)Dr. Muath Asmar
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This document provides an overview of derivative securities markets. It defines derivatives as financial securities whose payoff is linked to another security. Derivatives allow parties to exchange risk. Common derivatives discussed include forwards, futures, options, swaps, and other instruments. The document also examines the characteristics and uses of various derivative contracts and the markets in which they trade.Forward Vs Future.pptx
Forward Vs Future.pptxRishavGupta83
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- Forward and futures contracts lock in a price today for the purchase or sale of an asset in the future. Futures contracts are standardized and traded on exchanges, while forwards are customized contracts between parties.
- Both parties to a futures or forward contract are committed to fulfill their side of the deal. The party with the long position agrees to buy the asset, while the short position agrees to sell. Margin requirements ensure contracts are honored.
- Futures contracts are marked to market daily, meaning the contract price changes to the current market price. Gains or losses are deposited or withdrawn from the parties' accounts, keeping them indifferent to price changes until settlement. This reduces the incentive to default on contracts.Financial derivatives ppt
Financial derivatives pptVaishnaviSavant
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A derivative is a financial instrument whose value is derived from the value of another asset, known as the underlying. There are three main types of traders in the derivatives market: hedgers who use derivatives to reduce risk, speculators who trade for profits, and arbitrageurs who take advantage of price discrepancies across markets. Derivatives can be traded over-the-counter (OTC) or on an exchange, and provide various economic benefits such as risk reduction and enhanced market liquidity.Forward Vs Future and it's indepth knowledge
Forward Vs Future and it's indepth knowledgekumarsinghrahul232
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The document provides an overview of forward and futures contracts, highlighting their role as derivative securities that enable price locking for future transactions. It discusses the differences between forwards and futures, including their trading mechanisms, margin requirements, and the concept of marking to market. Additionally, the document explores applications such as hedging and arbitrage, detailing examples to illustrate how these financial instruments function in real-world scenarios.Financial markets and Institution options.pptx
Financial markets and Institution options.pptxsiyad22
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The document provides an extensive overview of various options types including call and put options, their exercise styles, underlying assets, and trading placements. It details key concepts in option trading such as intrinsic and time values, strategies for bullish and bearish markets, and numerous spread strategies such as vertical and horizontal spreads, butterflies, and condors. Additionally, it describes the mechanisms of risk management and hedging using combinations of options.Ad
More from William Hodge (9)
Comics Guide_20211130[31201].pdf
Comics Guide_20211130[31201].pdfWilliam Hodge
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A basic guide to advanced comic book collecting. The guide has something for everyone, and I really do mean that. At ~80 pages, a host of topics are explored including types of collecting, pricing guides, collection management, speculating vs. investing, comic grading, supply and demand, using pricing data wisely, goal setting and more.
In addition to practical real-world advice, we've included various charts and graphs to improve your understanding of various topics. QR codes have been embedded that allow you to use your cell phone's camera to jump to Youtube playlists and videos that complement the written text.
My mission through my YouTube channel, as with this book, is to help make sense of comic collecting for anyone, no matter where you are in your collecting journey. And I hope reading this guide helps you enjoy your journey a little bit more. Please subscribe to my YouTube
https://www.youtube.com/channel/UChcoxgpVUCLalncz2tcU1oQAML Letter
AML LetterWilliam Hodge
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Company Name, Inc. certifies to Company Name USA, Inc. that it has implemented anti-money laundering programs and a customer identification program that contains procedures for verifying customer identities, maintaining verification records, comparing customers to terrorist lists, and notifying customers about information collection. These programs have been applied to all current investment advisory customers.Superv. Cont. Chk List
Superv. Cont. Chk ListWilliam Hodge
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1. This document outlines the firm's supervisory procedures and controls for various areas including designations of supervisors, employee policies, training, licensing, communications, financial operations, and anti-money laundering programs.
2. Key areas covered include designation of supervisors and their responsibilities, outside business activities of employees, supervisory controls over correspondence and advertising, and designations of individuals responsible for areas like compliance.
3. The document also specifies the firm's procedures for areas like books and records, net capital calculations, and anti-money laundering compliance in accordance with applicable regulations.Generic Confidentiality Agreement
Generic Confidentiality AgreementWilliam Hodge
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1) Customer Firm Associates, L.P. is providing confidential organizational and financial documentation to Broker Dealer Inc. in connection with opening investment accounts.
2) Broker Dealer Inc. agrees to keep this information strictly confidential and only share it with employees who need to know for evaluating the accounts.
3) The confidentiality agreement does not apply to information that becomes publicly available, was previously known, or is obtained from another source not bound by confidentiality.Annual Ria Anti Money Laundering Cert. Clean
Annual Ria Anti Money Laundering Cert. CleanWilliam Hodge
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1. The firm certifies that it complies with anti-money laundering procedures when acting as a nominee for transactions, such as obtaining and maintaining documents identifying principals.
2. The firm monitors that principal's assets are not from illegal activities and that principals and accounts are not involved in illegal activities or subject to blocking by OFAC.
3. The firm agrees to notify Troika Dialog USA if any of these conditions change so that Troika Dialog USA can take actions like filing suspicious activity reports or blocking access.Qib Certification
Qib CertificationWilliam Hodge
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This document certifies that the undersigned is a Qualified Institutional Buyer (QIB) and Qualified Purchaser as defined by SEC
Rule 144A and the Investment Company Act. It places a check mark next to the type of institution it represents and makes
representations about owning a minimum amount of eligible securities. It also represents that it meets the criteria to be
considered a Qualified Purchaser, including not being formed for the specific purpose of investing in certain securities. The
document contains the undersigned's certification that it understands the confidential nature of any offering documents received
for Rule 144A securities.Research Checklist Generic
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This document is a compliance checklist for research analysts that outlines required disclosures, certifications, controls, and approvals when generating and distributing research reports. It specifies that analysts must disclose any conflicts of interest, certify that their opinions are unbiased, and that compensation does not influence their views. It also requires information barriers between research and investment banking, supervisory approval for reports distributed in the US, and training and attestations on insider trading policies for relevant employees. Additionally, the firm must file an annual Rule 2711 Certification to attest it has procedures to comply with regulations regarding research report distribution.Compliance Rules Grid
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This document outlines a supervisory control system and compliance program with various rules and procedures that must be followed on different time intervals, ranging from daily to annually. It covers areas such as supervisory procedures, branch office activities, personnel matters, financial reporting, customer accounts, communications, business continuity, anti-money laundering, and trade reporting. Many of the rules and procedures referenced are from FINRA and SEC regulations.Compliance Overview
Compliance OverviewWilliam Hodge
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The document provides an overview of US regulatory compliance for the securities industry. It discusses the history of securities regulation in the US following the 1929 stock market crash, including key legislation such as the Securities Act of 1933 and the Securities Exchange Act of 1934 which established the SEC. It also outlines the roles and functions of various compliance departments, including advisory services, training, monitoring, and fostering a culture of compliance.Ad