Margin (stocks) - To buy a security by borrowing funds from a brokerage house. The margin requirement-the maximum percentage of the investment that can be loaned by the brokerage firm-is set by the Federal Reserve Board.
Black Scholes Option Calculator - Option Trading Tips
So in terms of should one add the NPV of future pension benefits to his or her net worth, I think that 8767 s up to the individual. Personally I do not include my defined contribution pension because my plan 8767 s account balance is so small compared to my other investments that its impact will be negligible towards my wealth, and I only include major financial assets in my monthly net worth updates to keep it clean and simple. Also I don 8767 t actually have any direct access to it and can 8767 t spend it unless I stop working at the company.
Glossary Of Option Trading Terms by
Undervalued - Describing a security that is trading at a lower price than it logically should. Usually determined by the use of a mathematical model.
Excellent stuff. Finally a good site with a simple and easy to use spreadsheet!
Thanks guys! :)
-A gratified MBA Student.
Stop Limit Order - Similar to a stop order, the stop-limit order becomes a limit order, rather than a market order, when the security trades at the price specified on the stop. Read All About Options Stop Loss Here!
The 875K figure comes from the Capgemini World Wealth Report website.
Condor Spread - A complex neutral option strategy that profits from a stock trading within a predetermined range. Read All About Condor Spreads Here!
959a puts some real teeth into the Board s obligations to strike options at fair market value. If the strike prices are too low, the IRS will deem the options to be current income and will seek to collect income taxes upon issuance. Not only will the employee have tax obligations at the time of grant, but the company will have withholding obligations. In order to avoid all of this, the Board must document and prove that the strike price is fair market value. Most importantly, 959a allows the Board to use a third party valuation firm to advise and recommend a fair market value.
The difference between the underlying security's current market price and the option's strike price represents the amount of profit per share gained upon the exercise or the sale of the option. When an option is valuable it is referred to as being in-the-money. Worthless options are referred to as being out-of-the-money. Strike prices are one of the key determinants of option pricing, which is the market value of an options contract. Other determinants include the time until expiration, the volatility of the underlying security and prevailing interest rates.
Variable Ratio Write - An option strategy in which the investor owns 655 shares of the underlying security and writes two call options against it, each option having a different striking price.