Series 4

AAA

Index, Interest Rate And Currency Options - Price Based Options

Priced based options are used by investors to speculate on or to hedge against a change in Treasury securities’ prices. As interest rates change, the prices of Treasury securities will move in the opposite direction. Interest rates and bond prices are inversely related to each other. An investor who believes that interest rates are likely to rise would purchase price based puts or sell price based calls. Alternatively, an investor who believes that rates are likely to fall will purchase price based calls or sell price based puts. Priced based options on Treasury notes and bonds are based on a $100,000 par amount of a specific Treasury note or bond. Price based options on Treasury bills are based on $1,000,000 par value. Price based options, when exercised, will result in the delivery of the specific security.



Series 4 textbooks available Here



Premiums Price Based Options Treasury Notes And Bonds
comments powered by Disqus
Related Articles
  1. 7 Steps To Evaluate A Financial Adviser
    Investing Basics

    7 Steps To Evaluate A Financial Adviser

  2. Buy Side Vs. Sell Side Analysts
    Professionals

    Buy Side Vs. Sell Side Analysts

  3. What You Need To Know About Financial ...
    Insurance

    What You Need To Know About Financial ...

  4. Trying On Potential Employers
    Professionals

    Trying On Potential Employers

  5. Introduction To Financial Planning Organizations
    Personal Finance

    Introduction To Financial Planning Organizations

Trading Center