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Tag Archive: Options


Valuation Of Swaption: Back To School

imagesContinuing with our last post on Swaption, we are here to discuss the “Valuation of Swaption” today. A swaption can be settled in 2 ways as :-

  1. Physical settlement:- when an option is exercised to go ahead with the underlying Interest rate swap; and
  2. Cash Settlement:- When an option is exercised for the cash value and the market value of the underlying swap changes hands upon exercise.

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download (1)Today, I was thinking, what to write on and was confused whether to discuss on some current market situation or to go with some basic concept again for our finance freshers.  And, finally decided to write on SWAPTION, so as to add a thought again to our “back to School Series”.

Swaption was first introduced by William Lawton in 1983 while he was facilitating First Interstate Bank in Los Angeles as the Head Trader for Fixed Income Derivatives.

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10 Trading Tips

imagesWhen ever I felt like that I have tried to input maximum rules for trading something always come up as a part of new learning‘s.

Have done a series of posts mainly Mistakes Great Trader Never make , Price is what you pay – Value is what you get , Derivatives Known Unknowns and Regulators , ROGUE TRADER Charisma , Best Financial market learning some collection and many more –

Here are Dynamic Hedge whittle it down to 10. found them very interesting basic and very important. Every one of these points has a story behind it Continue reading

 

Binary Option Trading as A work From Home Opportunity

Millions of people scour the internet hopefully each day, searching for ways to make money online or work from the comfort of their own home. This can be no easy task, as the search results for phrases like “make money online” and “work from home” are so great in number. Even worse, the majority of them scams in some way or offering such a low rate of pay that Continue reading

CDS and Exotic Options

Ever heard of exotic options, like barrier, knock-out, and knock-in options. Lets try to distinguish them.

In finance, a barrier option is an exotic derivative typically an option on the underlying asset whose price breaching the pre-set barrier level either springs the option into existence or extinguishes an already existing option.

Where the option springs into existence on the price of the underlying Continue reading

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