Traded Options

Stephen Valdez

Chapter 10 in An Introduction to Western Financial Markets, 1993, pp 206-223 from Palgrave Macmillan

Abstract: Abstract Probably the fastest growing sector of the financial markets today is that of what are called derivative products. They are so called because they derive from another product. The buying of $1m for sterling is the product. The option to buy $1m for sterling later at a price we agree today is the derived product. Borrowing $1m at floating rate for five years is the product. A bank offering (for a fee) to compensate the borrower should rates rise above a given level in the next five years is the derived product — and so on.

Keywords: Interest Rate; Call Option; Share Price; Implied Volatility; American Option (search for similar items in EconPapers)
Date: 1993
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DOI: 10.1007/978-1-349-22961-1_10

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