options contracts

Q: What are the main differences between options and warrant contracts and forward and futures…

A: The difference among options and warrant contract:

Q: Discuss the payoff structures for call and put options and the determinants of call and put option…

A: Since you have asked multiple question, we will solve the first question for you. If you want to any…

Q: What is Lump-sum cash-value option?

A: The option is the contract with two or more options for the financial instrument. The lump-sum cash…

Q: hy not?

A: Introduction : A forward contract can be seen as a private, customizable contract which is exchanged…

Q: How is the call option price impacted by varying the risk free rate of interest? How is the call…

A: 1) Call option is the contract according to which the buyer of the option has the right but not the…

Q: What’s the difference between a financial optionand a real option? What are some specific typesof…

A: Answer: Differences between financial options and real options: Financial options are those…

Q: Explain why speculating in derivatives, futures contracts and options is not appropriate for the…

A: Speculation regulates the international financial system. Future action in stock market is dependent…

Q: What is the primary distinction between exchange-listed and over-the-counter options? Which option…

A: There are various uncertain future factors which can create the risk in coming time, to avoid or…

Q: What is a financial option? What is the singlemost important characteristic of an option?

A: Answer: A type of financial security that derives its value from the value of a particular…

Q: How does a dividend payment impact the option price?

A: The option price(call and put) is impacted by the new information about the announcement of the…

Q: The major difference between futures and options arises from the different obligations of buyers…

A: In futures contract, both the buyer and seller of the contract are obligated to buy and sell the…

Q: Explain what is meant by forward contracts and futures using examples. List the main advantages /…

A: An option offers the holder of it the right, and not the responsibility, to buy or to sell an asset…

Q: Futures contracts offer more flexible terms than a forward contract. True False

A: Futures and Forward contracts are contracts which allows to buy or sell an underlying asset at a…

Q: Discuss how equity can be viewed as an option. Who has theoption, and what decision can they make?

A: If an enterprise cannot satisfy its contractual obligation of debt, it is in default for every…

Q: What is a futures contract? What are the key differences between forward andfutures contracts?

A: Futures Contract are the Promises made between two parties on the platform called exchange for the…

Q: is put option? What is payoff to put option buyer and seller on expiry?

A: A put option is an instrument which provides its holder an option to sell an underlying asset on a…

Q: Explain why futures contracts may mitigate the credit risk involved in forward contracts.

A: Forward and future contracts are two types of risk management and hedging strategies.

Q: How does a futures contract differ from a forward contract?

A: Derivatives: A derivative is defined as a financial instrument whose value is derived from the value…

Q: What is the payoff to call option buyer and seller?

A: Call option A call option is referred to as the financial contract which provides its holder an…

Q: What is out-of-the money option?

A: Out of money options are generally preferable for the investors. This is because they are more…

Q: What are some factors that affect a call option’s value?

A: Options are the strategies opted by investors in which investors have a right but not a commitment…

Q: Why might individuals purchase futures contracts rather than the underlying asset?

A: Futures are derivative contracts, the price movement of a derivative contract (like futures) is…

Q: Forwards and Futures: How are forwards and futures similar? How are they different? Briefly explain…

A: A forward contract is referred to the customized contract, which is between the two parties for…

Q: Which of the following about options contracts is not true? One only side has an obligation; the…

A: Option is a financial contract where it provides its holder the right to exercise option, if he/she…

Q: What effect does Risk-free rate have on call option price?

A: Risk-free rate is the rate of return from an investment having no risk or zero risk. In other words,…

Q: Why do options sell at prices higher than their exercise values?

A: Options are contracts that give an 'option' or a choice to the holder to exercise the option or to…

Q: What are options?

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts…

Q: What are those factors? Which is most AND least significant?

A: Following are the factors that affect option contract: Underlying Price Strike Price Time to…

Q: CBOE option market makers are also called liquidity providers. True or False?

A: CBOE stands for the Chicago Board Options Exchange.