Decks in this Class (10):

A Calculate And Interpret The Prices Of
a calculate and interpret the prices of a synthetic call option, synthetic put option, synthetic bond, and synthetic underlying stock, and explain why an investor would want to create such instruments;
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B Calculate And Interpret Prices Of Inte
b calculate and interpret prices of interest rate options and options on assets using one and twoperiod binomial models;
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C Explain And Evaluate The Assumptions U
c explain and evaluate the assumptions underlying the Black–Scholes–Merton model;
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D Explain How An Option Price As Represe
d explain how an option price, as represented by the Black–Scholes–Merton model, is affected by a change in the value of each of the inputs;
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E Explain The Delta Of An Option And Dem
e explain the delta of an option, and demonstrate how it is used in dynamic hedging;
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F Explain The Gamma Effect On An Option
f explain the gamma effect on an option’s delta and how gamma can affect a delta hedge;
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G Explain The Effect Of The Underlying A
g explain the effect of the underlying asset’s cash flows on the price of an option;
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H Determine The Historical And Implied V
h determine the historical and implied volatilities of an underlying asset;
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I Demonstrate How Put Call Parity For Op
i demonstrate how put–call parity for options on forwards (or futures) is established;
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J Compare American And European Options
j compare American and European options on forwards and futures, and identify the appropriate pricing model for European options.
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