PUT-CALL PARITY
A principle referring to the static price relationship, given a stock's price, between the prices of European put and call options of the same class (i.e. same underlying, strike price and expiration date). This relationship is shown from the fact that combinations of options can create positions that are the same as holding the stock itself. These option and stock positions must all have the same return or an arbitrage opportunity would be available to traders. Any option pricing model that produces put and call prices that don't satisfy put-call parity should be rejected as unsound because arbitrage opportunities exist.
POPULAR TERMS
SFAC
The Statement of Financial Accounting Concepts (SFAC) is a Financial Accounting Standards Board (FASB) document that covers broad financial reporti ...
Eco-Communalism
Economic/environmental philosophy focusing on local economies, sustainability, and self-sufficiency. It is based on the belief several self-suffici ...
Barone-Adesi And Whaley Model
The quadratic estimation technique for putting a price on exchange-traded American call and put options on commodity futures and commodities. Baron ...
G. Allen Andreas Jr.
Former President, Chairman, and Chief Executive Officer of Archer Daniels Midland (ADM), an agribusiness firm in the United States with operations ...
Third Market
Marketplace where brokers/dealers and institutional investors trade exchange-listed stocks. In essence, the market encomapasses securities listed o ...
POPULAR ARTICLE
SEE FOREX TUTORIAL
Ethical Investing: Corporate Governance
It is important for ethical investors to determine how companies manage themselves and their relations with investors and stakeholders.
< ...
The Types of Stock
Now that you’ve learned the basics of stocks, what it is, and how it works, we can now learn more about them. The next thing you need to know ...
Buying a Home: Choosing the Best Location
The first consideration when buying a new house is choosing the place where you want to live, regardless if this will serve as an investment or upg ...
Buying a Home: Finding the Best House
Nothing can stop you from looking for the home of your dreams. Even though you have no agent, you can do your own diligence. Drive around neighborh ...
Student Loans: Federal Loans
Most of the students mull over the idea of maximizing the federal loan availability first before borrowing for college through a private loan. Norm ...
ECONOMIC CALENDAR
| Time | Country | Indices | Period |
|---|---|---|---|
| 02:30 | PMI Manufacturing | Sep | |
| 02:30 | Tertiary Industry Index | Sep | |
| 02:30 | PMI Composite | Sep | |
| 07:35 | BOJ Governor Haruhiko Kuroda Speaks | ||
| 10:00 | Ifo Business Climate Index | Sep | |
| 10:00 | Ifo Current Assessment | Sep | |
| 10:00 | IFO - Expectations | Sep | |
| 15:00 | NBB Business Climate | Sep | |
| 18:00 | FOMC Member Raphael W. Bostic Speaks |
