Why does put-call parity not hold, when option is American
Why does put-call parity not hold, when option is American?
Expert
When the options are American, put–call parity does not hold, since the short position could be exercised against you, leaving you along with several exposures to the stock price. Thus we don’t know what we will be worth on expiration. Without dividends this is theoretically never optimal to exercise an American call before expiration, while an American put must be exercised when the stock falls low sufficient.
Normal 0 false false
Is there margin option on long positions? Explain.
how does adquate liquidity ensures a good international monetary sustem
Define market participants in the foreign exchange market?The market participants which comprise the FX market can be categorized in five groups: international banks, non-bank dealers, bank customers, FX brokers, and central banks. Internation
What is half Kelly?
Illustrates an example of Poisson Process?
Define agent and his responsibilities.
Explain the Jump-diffusion models in an option-pricing.
Letters of Credit: It is a binding document which a buyer can request from his bank in order to pledge that the payment for goods will be moved to the seller. Principally, a letter of credit provides the seller reassurance that he will obtain the paym
How is gamma measure the rehedged position?
18,76,764
1929269 Asked
3,689
Active Tutors
1451247
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!