Indexed options based on the underlying price

• Authors: Radnai M.
• Languages of publication: HU

Abstracts

EN

Indexed options are ones that can only be exercised at a profit if the yield of the stock concerned exceeds the yield of a certain index. The article shows that structures published so far, in which the call option is indexed to the exercise price of the instrument, does not filter out all index risk. A proposal is made for a new type of indexed option, indexed to the price of the underlying product, so that all index risk is eliminated. The valuation relations of these options are provided and it is shown that they can be used not only for executive remuneration, but in stock-market trading as well.

Keywords

EN

FISCAL POLICY; INDEXED OPTIONS; STOCK OPTIONS

Discipline

• ECONOMICS: ECONOMICS

• Publisher: Committee for Economic Sciences of the Hungarian Academy of Sciences
• Journal: Kozgazdasagi Szemle (Economic Review)
• Year: 2005
• Volume: 52
• Issue: 2
• Pages: 130-143
• Document type: ARTICLE

Contributors

author

Radnai M.

• M. Radnai, no address given, contact the journal editor

Identifiers

CEJSH db identifier

07HUAAAA02956023