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The ratio of the dollar price change in the price of an option to a 1% change in the expected price volatility.
Knockin Option
An option that “comes to life” when a trigger event occurs. Typically when a price crosses a particular barrier it pulls the trigger.
Knockout Option
An option that “dies” when a trigger event occurs. Typically when a price crosses a particular barrier it pulls the trigger.
A contract that, in exchange for the option price, gives the option buyer the right, but not the obligation, to buy (or sell) a financial asset at the exercise price from (or to) the option […]
A series of unexpected cash withdrawals caused by a sudden decline in depositor confidence or fear that the bank will be closed by the charteringagency, i.e. many depositors withdraw cash almost simultaneously. Since the cash […]
Macaulay Duration 1. A measure of the sensitivity of a financial instrument’s value to a change in its yield. Macaulay Duration is an overestimate, and Modified Duration (q.v.) is a more precise measure. 2. The […]
