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Full-Text Articles in Finance and Financial Management
Nasdaq To Acquire Ise, Steven D. Dolvin
Nasdaq To Acquire Ise, Steven D. Dolvin
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Nasdaq is set to acquire the International Securities Exchange (ISE). The combined firm will manage six exchanges, representing 38 percent of US options trading. This will surpass the CBOE, which manages about 27 percent of the option trading market. See article here, Bloomberg.
Covered Calls, Steven D. Dolvin
Covered Calls, Steven D. Dolvin
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A Covered Call is created by purchasing stock and simultaneously writing a call on that stock. The position limits upside, as the stock will be called away if the price rises above the exercise price. But, the premium from selling the call provides extra income, which is the primary reason for executing such a strategy. See the article here, WSJ.
Snow Futures?, Steven D. Dolvin
Snow Futures?, Steven D. Dolvin
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Futures contracts are typically viewed as speculative investments; however, much of the activity in such contracts is the result of hedging. For example, insurance companies use weather derivatives to hedge exposure to natural disasters, while farmers and food producers would transact in agricultural futures. The most recent addition to such categories is snow futures. See article here, CME Group.
Rogue Trader, Steven D. Dolvin
Rogue Trader, Steven D. Dolvin
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On June 30, 2009, the price of oil jumped $1.50 per barrel during the night. This was curious since no major political event had taken place. Well, the Financial Services Authority just released a report that a drunk trader purchased futures contracts on 7 million barrels, which pushed the price up. Even more ironic, the trader was so drunk he didn't even remember doing it. See article here, CNBC.
Futures Exchanges, Steven D. Dolvin
Futures Exchanges, Steven D. Dolvin
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Most people are familiar with the primary futures exchanges, such as the CBOT, CME, and the NYMEX (all part of the CME Group). However, there are some more specialized (and interesting) exchanges. For example, check out Intrade, which is a futures market based on political outcomes. Also, you can invest based on Hollywood movies ().
Weather Derivatives, Steven D. Dolvin
Weather Derivatives, Steven D. Dolvin
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Most people are aware of stock options or futures contracts on commodities such as gold and oil. However, the derivatives market is very diverse, including such things as weather derivatives. With hurricane season upon us, you may want to do some research on hurricane futures and options (http://www.cmegroup.com/trading/weather/hurricanes/hurricane.html). Essentially, these contracts allow insurers to transfer risk to other parties, such as hedge funds. See the article here, CME Group.
Cds Trades Continue, Steven D. Dolvin
Cds Trades Continue, Steven D. Dolvin
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JP Morgan recently announced a $2 billion loss, which renewed criticisms that originally surfaced during the credit crisis. While final details are still to come, initial reports suggest that much of the loss is attributable to the sale of Credit Default Swap (CDS) contracts. Similar exposures helped lead to the downfall of Lehman Bros., Bear Sterns, and AIG following the Crash of 2008. (See the article here, Fox Business.)