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Forex equity definition

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forex equity definition

In financean equity derivative is a class of derivatives whose value is at least partly derived from one or more underlying equity securities. Options and futures are by far the most common equity derivatives, however there are many other types of equity derivatives that are actively traded. Equity options are the most common type of equity derivative. In financea warrant is a security that entitles the holder to definition stock of the company that issued it at a specified price, which is much lower than the stock price at time of issue. Warrants are frequently attached to bonds or preferred stock as a sweetener, allowing the issuer to pay lower interest rates or dividends. They can be used to enhance the yield of the bond, and make them more attractive to potential buyers. Convertible bonds are bonds that can be converted into shares of stock in the issuing companyusually at some pre-announced ratio. It is a hybrid security with debt- and equity-like features. It can be used by investors to obtain the upside of equity-like returns while protecting the downside with regular bond-like coupons. Investors can gain exposure to the equity markets using forex, options and swaps. These equity be done on single stocks, a customized basket forex stocks or on an index of stocks. These equity derivatives derive their value from the price of the underlying stock or stocks. Stock markets index futures are futures contracts used to replicate the performance of an underlying stock market index. They can be used for hedging against an existing equity position, or speculating on future movements of the index. Indices for OTC products are broadly similar, but offer more flexibility. Equity basket derivatives are futures, options or swaps where the underlying is a non-index basket of shares. They have similar characteristics to equity index derivatives, but are always traded OTC over the counter, i. Single-stock futures are exchange-traded futures contracts based on an individual underlying security rather than a stock index. Their performance is similar to that of the underlying equity itself, although as futures contracts they are usually traded with greater leverage. Another difference is that holders of long positions in single equity futures typically do not receive dividends and holders of short positions do not pay dividends. Single-stock futures may be cash-settled or physically settled by the transfer of the underlying stocks at expiration, although in the United States only physical settlement is used to avoid speculation in the market. An equity index swap is an agreement between two parties to swap two sets of cash flows on predetermined dates for an agreed number of years. The cash flows will be an equity index value swapped, for instance, with LIBOR. Swaps can be considered a relatively straightforward way of gaining exposure equity a required asset class. They can also be relatively cost efficient. An equity swap, like an definition index swap, is an agreement between two parties to swap two sets of cash flows. In this case the cash flows will be the price of an underlying stock forex swapped, for instance, with LIBOR. A typical example of this type of derivative is the Contract for equity CFD where one party gains exposure to a share price without buying or selling the underlying share making it relatively cost equity as well as making it relatively easy to forex. Other examples of equity derivative securities include exchange-traded funds and Intellidexes. From Wikipedia, the free encyclopedia. Stock market index future. Credit spread Debit spread Exercise Expiration Moneyness Open interest Pin risk Risk-free interest rate Strike price the Greeks Volatility. Bond option Call Employee stock option Fixed income FX Option styles Put Warrants. Asian Barrier Basket Binary Chooser Cliquet Commodore Compound Forward start Interest rate Lookback Mountain range Rainbow Swaption. Collar Covered call Fence Iron butterfly Iron condor Straddle Strangle Protective put Risk reversal. Back Forex Box Bull Butterfly Calendar Diagonal Intermarket Ratio Vertical. Binomial Black Black—Scholes model Finite difference Garman-Kohlhagen Margrabe's definition Put—call parity Simulation Real options valuation Trinomial Vanna—Volga pricing. Amortising Asset Basis Conditional definition Constant maturity Correlation Credit definition Currency Dividend Equity Forex Inflation Interest rate Overnight indexed Total return Variance Volatility Year-on-Year Inflation-Indexed Zero-Coupon Inflation-Indexed. Contango Currency future Dividend future Forward market Forward price Forwards pricing Forward rate Futures pricing Interest rate future Margin Normal backwardation Equity futures Slippage Stock market index future. Energy derivative Freight derivative Inflation derivative Property derivative Weather derivative. Collateralized debt obligation CDO Constant proportion portfolio insurance Contract for difference Credit-linked note CLN Credit default option Credit derivative Equity-linked definition ELN Equity derivative Foreign exchange derivative Definition derivative Interest rate derivative Mortgage-backed security Power reverse dual-currency note PRDC. Consumer debt Corporate debt Government debt Great Recession Municipal debt Tax policy. Retrieved from " https: Derivatives finance Options finance. All Wikipedia articles needing clarification Wikipedia articles needing clarification from March All accuracy disputes Articles with disputed statements from November Navigation menu Personal tools Not logged in Talk Contributions Create account Log forex. Views Read Edit View history. Navigation Main page Contents Featured content Current events Random article Donate to Wikipedia Wikipedia store. Interaction Help About Forex Community portal Recent changes Contact page. Tools What links here Related changes Upload file Special pages Permanent link Page information Wikidata item Cite this page. This page was last edited on 9 Julyat Text is available under the Creative Commons Attribution-ShareAlike License ; additional terms may apply. By using equity site, you agree to the Terms of Use and Privacy Policy. Privacy policy About Wikipedia Disclaimers Contact Wikipedia Developers Cookie statement Mobile view. Terms Credit spread Debit spread Exercise Expiration Moneyness Open interest Pin risk Risk-free interest rate Strike price the Greeks Volatility. forex equity definition

3 thoughts on “Forex equity definition”

  1. Andreyul says:

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  3. andri85 says:

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