Financial Instruments

Forwards

 

Forward derivatives, also known as “forward contracts” or “forwards,” are a type of financial instrument used to hedge risk, speculate on price movements, or lock in future prices for assets. These derivatives are private agreements between two parties to buy or sell an asset at a predetermined price on a specified future date.

Here’s a detailed breakdown of forward derivatives:

 

1. Definition of Forward Contracts:

A forward contract is an agreement between two parties (usually referred to as the “buyer” and the “seller”) to exchange an asset for a specific price at a future date. The contract can be made for various types of underlying assets, such as commodities (oil, gold), currencies, interest rates, or even stock indices.

• Buyer: The party that agrees to purchase the asset at the agreed-upon price (known as the forward price) at the specified future date.
• Seller: The party that agrees to sell the asset at the forward price at the future date.

 

2. Forward Price:

The forward price is the agreed-upon price for the asset in the contract. It is determined based on the spot price of the underlying asset (the current market price) and factors such as the time until the contract’s expiration, interest rates, and any storage or carrying costs (for physical assets like commodities).

The forward price can be determined using the following formula:

 

 

$$F_0 = S_0 \times e^{(r \times T)}$$

 

Where:

• F₀ = forward price
• _S0 = spot price (current market price)
• r = risk-free interest rate (annualized)
• T = time to maturity in years
• e = base of the natural logarithm (approx. 2.718)

 

3. Features of Forward Derivatives:

• Customisation: Forward contracts are customizable agreements, meaning the buyer and seller can specify the contract’s terms, including the asset type, quantity, delivery date, and location.
• Over-the-Counter (OTC): Unlike standardized derivatives (like futures contracts), forward contracts are typically traded over-the-counter (OTC) and are not exchanged on a formal exchange. This makes them more flexible but also more risky due to counterparty risk (the risk that the other party might not fulfill their obligations).
• Settlement: Forward contracts can be settled either through physical delivery (where the asset is physically exchanged) or through cash settlement (where the difference between the spot price at expiration and the forward price is paid).
• Leverage: Forward contracts are typically used with leverage, meaning that they allow for the exposure to large amounts of an asset with a relatively small initial investment.

 

4. Advantages of Forward Contracts:

• Customisation: Forward contracts can be tailored to meet the specific needs of the parties involved. Unlike futures contracts, which are standardized, forwards allow flexibility in terms of contract size, maturity, and other terms.
• Hedging: Forwards are often used by businesses or investors to hedge against future price fluctuations. For example, a company that imports raw materials may enter into a forward contract to lock in a specific price to protect itself from rising commodity prices.
• No Margin Requirement: Unlike futures contracts, which may require margin payments, forward contracts typically don’t require initial margin deposits. However, both parties bear the risk that one may not fulfill their obligations.

 

5. Risks of Forward Contracts:

• Counterparty Risk: Since forward contracts are privately negotiated between two parties, there is a risk that one party may not honor the contract, especially if the contract is not settled until the end of the term.
• Lack of Liquidity: Forward contracts are generally not as liquid as futures contracts or other exchange-traded instruments because they are privately negotiated.
• No Standardization: Since these contracts are customized, the terms may vary from one agreement to another, making them harder to price and trade in secondary markets.
• Market Risk: The price of the underlying asset can move unfavorably, resulting in a loss for one of the parties involved in the contract.

 

6. Example of a Forward Contract:

Let’s say an investor wants to lock in the price of gold, which is currently trading at $1,800 per ounce, for a future date of six months from now. The investor enters into a forward contract with a counterparty (a bank or another investor) to buy 100 ounces of gold at a price of $1,800 per ounce in six months.

• If, in six months, the spot price of gold rises to $2,000 per ounce, the investor will still be able to purchase the gold at $1,800 per ounce as per the forward contract, realizing a profit of $200 per ounce.
• If the spot price falls to $1,700 per ounce, the investor will have to buy the gold at the agreed price of $1,800 per ounce, incurring a loss of $100 per ounce.

 

7. Forward Derivatives in Financial Markets:

Forward contracts are used in various sectors, including:

• Hedging: Corporations, especially those involved in international trade, use forward contracts to hedge against fluctuations in currency exchange rates.
• Speculation: Investors use forwards to speculate on the direction of future prices of assets, such as commodities, currencies, or stock indices.
• Interest Rate Management: Forward rate agreements (FRAs) are used by banks and other financial institutions to lock in future interest rates on loans or deposits.

 

8. Forward vs. Futures Contracts:

While forward contracts and futures contracts are similar, they have some key differences:

• Standardisation: Futures contracts are standardized and traded on exchanges, while forward contracts are privately negotiated.
• Margin Requirements: Futures contracts require margin payments to cover potential losses, while forwards typically don’t.
• Settlement: Futures contracts are marked-to-market daily, meaning gains and losses are realized daily, whereas forwards settle at the contract’s maturity date.

 

Conclusion:

Forward derivatives are valuable financial instruments used to manage risk, lock in prices, or speculate on price changes. They offer flexibility in terms of contract specifications but also come with increased risks, such as counterparty risk and lack of liquidity. While they are widely used in various industries, understanding the mechanics and risks of forwards is essential for anyone involved in their use.

ASX Listed Exchange Traded Funds (ETFs)

 

Exchange	Issuer	Asset Class	Code	Fund Name
ASX	Airlie Funds Management	Australian Shares	AASF	Airlie Australian Share Fund
ASX	Apostle		ADEF	Apostle Dundas Global Equity Fund - Class D Units (Managed Fund)
ASX	BetaShares	Active	BNDS	Western Asset Australian Bond Fund (Managed Fund)
ASX	BetaShares	Active	EINC	Martin Currie Equity Income Fund (Managed Fund)
ASX	BetaShares	Active	EMMG	Martin Currie Emerging Markets Fund (Managed Fund)
ASX	BetaShares	Active	HBRD	Active Australian Hybrids Fund
ASX	BetaShares	Active	RINC	Martin Currie Real Income Fund (Managed Fund)
ASX	BetaShares	Australian Shares	A200	Australia 200 ETF
ASX	BetaShares	Australian Shares	AQLT	Australian Quality ETF
ASX	BetaShares	Australian Shares	ATEC	S&P/ASX Australian Technology ETF
ASX	BetaShares	Australian Shares	AUST	Managed Risk Australian Share Fund (Managed Fund)
ASX	BetaShares	Australian Shares	BBOZ	Australian Equities Strong Bear Hedge Fund
ASX	BetaShares	Australian Shares	BEAR	Australian Equities Bear Hedge Fund
ASX	BetaShares	Australian Shares	EINC	Martin Currie Equity Income Fund (Managed Fund)
ASX	BetaShares	Australian Shares	EX20	Australian Ex-20 Portfolio Diversifier ETF
ASX	BetaShares	Australian Shares	FAIR	Australian Sustainability Leaders ETF
ASX	BetaShares	Australian Shares	GEAR	Geared Australian Equity Fund (Hedge Fund)
ASX	BetaShares	Australian Shares	HVST	Australian Dividend Harvester Fund (Managed Fund)
ASX	BetaShares	Australian Shares	QFN	Australian Financials Sector ETF
ASX	BetaShares	Australian Shares	QOZ	FTSE RAFI Australia 200 ETF
ASX	BetaShares	Australian Shares	QRE	Australian Resources Sector ETF
ASX	BetaShares	Australian Shares	RINC	Martin Currie Real Income Fund (Managed Fund)
ASX	BetaShares	Australian Shares	SMLL	Australian Small Companies Select Fund (Managed Fund)
ASX	BetaShares	Australian Shares	YMAX	Australian Top 20 Equity Yield Maximiser Fund (Managed Fund)
ASX	BetaShares	Cash & Fixed Income	AAA	Australian High Interest Cash ETF
ASX	BetaShares	Cash & Fixed Income	AGVT	Australian Government Bond ETF
ASX	BetaShares	Cash & Fixed Income	BNDS	Western Asset Australian Bond Fund (Managed Fund)
ASX	BetaShares	Cash & Fixed Income	CRED	Australian Investment Grade Corporate Bond ETF
ASX	BetaShares	Cash & Fixed Income	GBND	Sustainability Leaders Diversified Bond ETF - Currency Hedged
ASX	BetaShares	Cash & Fixed Income	GGOV	Global Government Bond 20+ Year ETF - Currency Hedged
ASX	BetaShares	Cash & Fixed Income	OZBD	Australian Composite Bond ETF
ASX	BetaShares	Cash & Fixed Income	QPON	Australian Bank Senior Floating Rate Bond ETF
ASX	BetaShares	Commodities	OOO	Crude Oil Index ETF - Currency Hedged (Synthetic)
ASX	BetaShares	Commodities	QAU	Gold Bullion ETF - Currency Hedged
ASX	BetaShares	Currency	AUDS	Strong Australian Dollar Fund (Hedge Fund)
ASX	BetaShares	Currency	EEU	Euro ETF
ASX	BetaShares	Currency	POU	British Pound ETF
ASX	BetaShares	Currency	USD	U.S. Dollar ETF
ASX	BetaShares	Currency	YANK	Strong U.S. Dollar Fund (Hedge Fund)
ASX	BetaShares	Digital Assets	CRYP	Crypto Innovators ETF
ASX	BetaShares	Diversified	DBBF	Ethical Diversified Balanced ETF
ASX	BetaShares	Diversified	DGGF	Ethical Diversified Growth ETF
ASX	BetaShares	Diversified	DHHF	Diversified All Growth ETF
ASX	BetaShares	Diversified	DZZF	Ethical Diversified High Growth ETF
ASX	BetaShares	Equity Income	EINC	Martin Currie Equity Income Fund (Managed Fund)
ASX	BetaShares	Equity Income	HVST	Australian Dividend Harvester Fund (Managed Fund)
ASX	BetaShares	Equity Income	INCM	Global Income Leaders ETF
ASX	BetaShares	Equity Income	RINC	Martin Currie Real Income Fund (Managed Fund)
ASX	BetaShares	Equity Income	UMAX	S&P 500 Yield Maximiser Fund (Managed Fund)
ASX	BetaShares	Equity Income	YMAX	Australian Top 20 Equity Yield Maximiser Fund (Managed Fund)
ASX	BetaShares	Ethical	DBBF	Ethical Diversified Balanced ETF
ASX	BetaShares	Ethical	DGGF	Ethical Diversified Growth ETF
ASX	BetaShares	Ethical	DZZF	Ethical Diversified High Growth ETF
ASX	BetaShares	Ethical	ERTH	Climate Change Innovation ETF
ASX	BetaShares	Ethical	ETHI	Global Sustainability Leaders ETF
ASX	BetaShares	Ethical	FAIR	Australian Sustainability Leaders ETF
ASX	BetaShares	Ethical	GBND	Sustainability Leaders Diversified Bond ETF - Currency Hedged
ASX	BetaShares	Ethical	HETH	Global Sustainability Leaders ETF - Currency Hedged
ASX	BetaShares	Global Sectors	BNKS	Global Banks ETF - Currency Hedged
ASX	BetaShares	Global Sectors	DRUG	Global Healthcare ETF - Currency Hedged
ASX	BetaShares	Global Sectors	FUEL	Global Energy Companies ETF - Currency Hedged
ASX	BetaShares	Global Sectors	MNRS	Global Gold Miners ETF - Currency Hedged
ASX	BetaShares	Hybrids	BHYB	Australian Major Bank Hybrids Index ETF
ASX	BetaShares	Hybrids	HBRD	Active Australian Hybrids Fund
ASX	BetaShares	International Shares	ASIA	Asia Technology Tigers ETF
ASX	BetaShares	International Shares	BBUS	U.S. Equities Strong Bear Hedge Fund - Currency Hedged
ASX	BetaShares	International Shares	BNKS	Global Banks ETF - Currency Hedged
ASX	BetaShares	International Shares	CLDD	Cloud Computing ETF
ASX	BetaShares	International Shares	DRUG	Global Healthcare ETF - Currency Hedged
ASX	BetaShares	International Shares	EDOC	Digital Health and Telemedicine ETF
ASX	BetaShares	International Shares	EMMG	Martin Currie Emerging Markets Fund (Managed Fund)
ASX	BetaShares	International Shares	ERTH	Climate Change Innovation ETF
ASX	BetaShares	International Shares	ETHI	Global Sustainability Leaders ETF
ASX	BetaShares	International Shares	F100	FTSE 100 ETF
ASX	BetaShares	International Shares	FOOD	Global Agriculture Companies ETF - Currency Hedged
ASX	BetaShares	International Shares	FUEL	Global Energy Companies ETF - Currency Hedged
ASX	BetaShares	International Shares	GGUS	Geared U.S. Equity Fund - Currency Hedged (Hedge Fund)
ASX	BetaShares	International Shares	HACK	Global Cybersecurity ETF
ASX	BetaShares	International Shares	HETH	Global Sustainability Leaders ETF - Currency Hedged
ASX	BetaShares	International Shares	HEUR	Europe ETF - Currency Hedged
ASX	BetaShares	International Shares	HJPN	Japan ETF - Currency Hedged
ASX	BetaShares	International Shares	HNDQ	NASDAQ 100 ETF - Currency Hedged
ASX	BetaShares	International Shares	HQLT	Global Quality Leaders ETF - Currency Hedged
ASX	BetaShares	International Shares	IIND	India Quality ETF
ASX	BetaShares	International Shares	INCM	Global Income Leaders ETF
ASX	BetaShares	International Shares	MNRS	Global Gold Miners ETF - Currency Hedged
ASX	BetaShares	International Shares	NDQ	NASDAQ 100 ETF
ASX	BetaShares	International Shares	QLTY	Global Quality Leaders ETF
ASX	BetaShares	International Shares	QUS	S&P 500 Equal Weight ETF
ASX	BetaShares	International Shares	RBTZ	Global Robotics and Artificial Intelligence ETF
ASX	BetaShares	International Shares	UMAX	S&P 500 Yield Maximiser Fund (Managed Fund)
ASX	BetaShares	International Shares	WRLD	Managed Risk Global Share Fund (Managed Fund)
ASX	BetaShares	Managed Risk	AUST	Managed Risk Australian Share Fund (Managed Fund)
ASX	BetaShares	Managed Risk	HVST	Australian Dividend Harvester Fund (Managed Fund)
ASX	BetaShares	Managed Risk	WRLD	Managed Risk Global Share Fund (Managed Fund)
ASX	BetaShares	Property	RINC	Martin Currie Real Income Fund (Managed Fund)
ASX	BetaShares	Short & Geared	AUDS	Strong Australian Dollar Fund (Hedge Fund)
ASX	BetaShares	Short & Geared	BBOZ	Australian Equities Strong Bear Hedge Fund
ASX	BetaShares	Short & Geared	BBUS	U.S. Equities Strong Bear Hedge Fund - Currency Hedged
ASX	BetaShares	Short & Geared	BEAR	Australian Equities Bear Hedge Fund
ASX	BetaShares	Short & Geared	GEAR	Geared Australian Equity Fund (Hedge Fund)
ASX	BetaShares	Short & Geared	GGUS	Geared U.S. Equity Fund - Currency Hedged (Hedge Fund)
ASX	BetaShares	Short & Geared	YANK	Strong U.S. Dollar Fund (Hedge Fund)
ASX	BetaShares	Technology	ASIA	Asia Technology Tigers ETF
ASX	BetaShares	Technology	ATEC	S&P/ASX Australian Technology ETF
ASX	BetaShares	Technology	CLDD	Cloud Computing ETF
ASX	BetaShares	Technology	DRIV	Electric Vehicles and Future Mobility ETF
ASX	BetaShares	Technology	GAME	Video Games and Esports ETF
ASX	BetaShares	Technology	HACK	Global Cybersecurity ETF
ASX	BetaShares	Technology	HNDQ	NASDAQ 100 ETF - Currency Hedged
ASX	BetaShares	Technology	IBUY	Online Retail and E-Commerce ETF
ASX	BetaShares	Technology	IPAY	Future of Payments ETF
ASX	BetaShares	Technology	NDQ	NASDAQ 100 ETF
ASX	BetaShares	Technology	RBTZ	Global Robotics and Artificial Intelligence ETF
ASX	BetaShares	Thematic	ASIA	Asia Technology Tigers ETF
ASX	BetaShares	Thematic	ATEC	S&P/ASX Australian Technology ETF
ASX	BetaShares	Thematic	CLDD	Cloud Computing ETF
ASX	BetaShares	Thematic	CRYP	Crypto Innovators ETF
ASX	BetaShares	Thematic	DRIV	Electric Vehicles and Future Mobility ETF
ASX	BetaShares	Thematic	EDOC	Digital Health and Telemedicine ETF
ASX	BetaShares	Thematic	ERTH	Climate Change Innovation ETF
ASX	BetaShares	Thematic	GAME	Video Games and Esports ETF
ASX	BetaShares	Thematic	HACK	Global Cybersecurity ETF
ASX	BetaShares	Thematic	IBUY	Online Retail and E-Commerce ETF
ASX	BetaShares	Thematic	IPAY	Future of Payments ETF
ASX	BetaShares	Thematic	RBTZ	Global Robotics and Artificial Intelligence ETF
ASX	BlackRock (iShares)	Cash	BILL	Core Cash ETF
ASX	BlackRock (iShares)	Cash	ISEC	Enhanced Cash ETF
ASX	BlackRock (iShares)	Commodities	GLDN	iShares Physical Gold ETF
ASX	BlackRock (iShares)	Equity - All Cap	AUMF	Edge MSCI Australia Multifactor ETF
ASX	BlackRock (iShares)	Equity - All Cap	GLIN	iShares Core FTSE Global Infrastructure (AUD Hedged) ETF
ASX	BlackRock (iShares)	Equity - All Cap	IHD	S&P/ASX Dividend Opportunities ETF
ASX	BlackRock (iShares)	Equity - All Cap	IHWL	Core MSCI World ex Australia ESG Leaders (AUD Hedged) ETF
ASX	BlackRock (iShares)	Equity - All Cap	ITEK	iShares Future Tech Innovators ETF
ASX	BlackRock (iShares)	Equity - All Cap	IWLD	iShares Core MSCI World ex Australia ESG Leaders ETF
ASX	BlackRock (iShares)	Equity - All Cap	MVOL	Edge MSCI Australia Minimum Volatility ETF
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IEM	MSCI Emerging Markets ETF
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IEU	Europe ETF
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IJP	MSCI Japan ETF
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IKO	MSCI South Korea ETF
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IVE	MSCI EAFE ETF
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IVV	S&P 500 ETF
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IXI	Global Consumer Staples ETF (AU)
ASX	BlackRock (iShares)	Equity - Large / Mid Cap	IXJ	Global Healthcare ETF (AU)
ASX	BlackRock (iShares)	Equity - Large Cap	IAA	Asia 50 ETF (AU)
ASX	BlackRock (iShares)	Equity - Large Cap	IESG	Core MSCI Australia ESG Leaders ETF
ASX	BlackRock (iShares)	Equity - Large Cap	IHOO	Global 100 (AUD Hedged) ETF
ASX	BlackRock (iShares)	Equity - Large Cap	IHVV	iShares S&P 500 (AUD Hedged) ETF
ASX	BlackRock (iShares)	Equity - Large Cap	ILC	S&P/ASX 20 ETF
ASX	BlackRock (iShares)	Equity - Large Cap	IOO	Global 100 ETF
ASX	BlackRock (iShares)	Equity - Large Cap	IOZ	Core S&P/ASX 200 ETF
ASX	BlackRock (iShares)	Equity - Large Cap	IZZ	China Large-Cap ETF (AU)
ASX	BlackRock (iShares)	Equity - Large Cap	WDMF	Edge MSCI World Multifactor ETF
ASX	BlackRock (iShares)	Equity - Large Cap	WVOL	Edge MSCI World Minimum Volatility ETF
ASX	BlackRock (iShares)	Equity - Mid Cap	IJH	S&P Mid-Cap ETF
ASX	BlackRock (iShares)	Equity - Small Cap	IJR	S&P Small-Cap ETF
ASX	BlackRock (iShares)	Equity - Small Cap	ISO	S&P/ASX Small Ordinaries ETF
ASX	BlackRock (iShares)	Fixed Income - Credit	AESG	iShares Global Aggregate Bond ESG (AUD Hedged) ETF
ASX	BlackRock (iShares)	Fixed Income - Credit	ICOR	Core Corporate Bond ETF
ASX	BlackRock (iShares)	Fixed Income - Credit	IHCB	Core Global Corporate Bond (AUD Hedged) ETF
ASX	BlackRock (iShares)	Fixed Income - Credit	IYLD	Yield Plus ETF
ASX	BlackRock (iShares)	Fixed Income - Government	IGB	Treasury ETF
ASX	BlackRock (iShares)	Fixed Income - Government	IHEB	J.P. Morgan USD Emerging Markets Bond (AUD Hedged) ETF
ASX	BlackRock (iShares)	Fixed Income - Government	IUSG	iShares U.S. Treasury Bond (AUD Hedged) ETF
ASX	BlackRock (iShares)	Fixed Income - High Yield	IHHY	Global High Yield Bond (AUD Hedged) ETF
ASX	BlackRock (iShares)	Fixed Income - Inflation	ILB	Government Inflation ETF
ASX	BlackRock (iShares)	Fixed Income - Multi Sectors	IAF	Core Composite Bond ETF
ASX	BlackRock (iShares)	Multi Asset - Multi Strategy	IBAL	iShares Balanced ESG ETF
ASX	BlackRock (iShares)	Multi Asset - Multi Strategy	IGRO	iShares High Growth ESG ETF
ASX	BlackRock (iShares)	Real Estate - Real Estate Securities	GLPR	iShares Core FTSE Global Property Ex Australia (AUD Hedged) ETF
ASX	Daintree		DHOF	Daintree Hybrid Opportinities Fund
ASX	Fidelity		FDEM	Global Demographics Fund (Managed Fund)
ASX	Global X ETFs	Commodities	ATOM	Uranium ETF
ASX	Global X ETFs	Commodities	BCOM	Bloomberg Commodity ETF (Synthetic)
ASX	Global X ETFs	Commodities	ETPMAG	Physical Silver
ASX	Global X ETFs	Commodities	ETPMPD	Physical Palladium
ASX	Global X ETFs	Commodities	ETPMPM	Physical Precious Metals Basket
ASX	Global X ETFs	Commodities	ETPMPT	Physical Platinum
ASX	Global X ETFs	Commodities	GCO2	Global Carbon ETF (Synthetic)
ASX	Global X ETFs	Commodities	GMTL	Green Metal Miners ETF
ASX	Global X ETFs	Commodities	GOLD	Physical Gold
ASX	Global X ETFs	Commodities	WIRE	Copper Miners ETF
ASX	Global X ETFs	Core	N100	US 100 ETF
ASX	Global X ETFs	Core	OZXX	Australia ex Financials & Resources ETF
ASX	Global X ETFs	Digital Assets	EBTC	21Shares Bitcoin ETF
ASX	Global X ETFs	Digital Assets	EETH	21Shares Ethereum ETF
ASX	Global X ETFs	Income	AYLD	S&P/ASX 200 Covered Call ETF
ASX	Global X ETFs	Income	QYLD	Nasdaq 100 Covered Call ETF
ASX	Global X ETFs	Income	USHY	USD High Yield Bond ETF (Currency Hedged)
ASX	Global X ETFs	Income	USIG	USD Corporate Bond ETF (Currency Hedged)
ASX	Global X ETFs	Income	USTB	US Treasury Bond ETF (Currency Hedged)
ASX	Global X ETFs	Income	UYLD	S&P 500 Covered Call ETF
ASX	Global X ETFs	Income	ZYAU	S&P/ASX 200 High Dividend ETF
ASX	Global X ETFs	Income	ZYUS	S&P 500 High Yield Low Volatility ETF
ASX	Global X ETFs	International	ESTX	EURO STOXX 50 ETF
ASX	Global X ETFs	International	NDIA	India Nifty 50 ETF
ASX	Global X ETFs	Leveraged & Inverse	LNAS	Ultra Long Nasdaq 100 Hedge Fund
ASX	Global X ETFs	Leveraged & Inverse	SNAS	Ultra Short Nasdaq 100 Hedge Fund
ASX	Global X ETFs	Thematic	ACDC	Battery Tech & Lithium ETF
ASX	Global X ETFs	Thematic	BUGG	Cybersecurity ETF
ASX	Global X ETFs	Thematic	CURE	S&P Biotech ETF
ASX	Global X ETFs	Thematic	FANG	FANG+ ETF
ASX	Global X ETFs	Thematic	FTEC	Fintech & Blockchain ETF
ASX	Global X ETFs	Thematic	HGEN	Hydrogen ETF
ASX	Global X ETFs	Thematic	ROBO	ROBO Global Robotics & Automation ETF
ASX	Global X ETFs	Thematic	SEMI	Semiconductor ETF
ASX	Global X ETFs	Thematic	TECH	Morningstar Global Technology ETF
ASX	Hyperion		HYN04	Hyperion Global Growth Companies Fund (Managed Fund)
ASX	Janus Henderson		FUTR	Global Sustainable Equity Active ETF
ASX	Loftus Peak		LOF01	Loftus Peak Global Disruption Fund
ASX	Loomis Sayles		LSGE	Loomis Sayles Global Equity Fund (Quoted)
ASX	Magellan		MHHT	Magellan High Conviction Trust
ASX	Monash Investors		MAAT	Monash Absolute Active Trust
ASX	Montaka Global Investments		MOGL	Montaka Global Long Only Equities Fund
ASX	Munro Partners		MAET	Munro Global Growth Fund
ASX	Munro Partners		MCCL	Munro Climate Change Leaders Fund
ASX	Munro Partners		MCGG	Munro Concentrated Global Growth Fund
ASX	Perennial		IMPQ	Perennial Better Future Fund
ASX	Perpetual		GIVE	Perpetual ESG Australian Share Fund
ASX	Perpetual		IDEA	Perpetual Global Innovation Share Fund
ASX	Russell Investments	Equity Income	RDV	Russell Investments High Dividend Australian Shares ETF
ASX	Russell Investments	Fixed Income	RCB	Russell Investments Australian Select Corporate Bond ETF
ASX	Russell Investments	Fixed Income	RGB	Russell Investments Australian Government Bond ETF
ASX	Russell Investments	Fixed Income	RSM	Russell Investments Australian Semi-Government Bond ETF
ASX	Russell Investments	Responsible Investing	RARI	Russell Investments Australian Responsible Investment ETF
ASX	Schroders		GROW	Schroder Real Return
ASX	State Street Global Advisors SPDR®		BOND	SPDR® S&P®/ASX Australian Bond Fund
ASX	State Street Global Advisors SPDR®		DJRE	SPDR® Dow Jones® Global Real Estate ESG Fund
ASX	State Street Global Advisors SPDR®		E200	SPDR® S&P®/ASX 200 ESG Fund
ASX	State Street Global Advisors SPDR®		GOVT	SPDR® S&P®/ASX Australian Government Bond Fund
ASX	State Street Global Advisors SPDR®		OZF	SPDR® S&P®/ASX 200 Financials EX A-REIT Fund
ASX	State Street Global Advisors SPDR®		OZR	SPDR® S&P®/ASX 200 Resources Fund
ASX	State Street Global Advisors SPDR®		QMIX	SPDR® MSCI World Quality Mix Fund
ASX	State Street Global Advisors SPDR®		SFY	SPDR® S&P®/ASX 50 Fund
ASX	State Street Global Advisors SPDR®		SLF	SPDR® S&P®/ASX 200 Listed Property Fund
ASX	State Street Global Advisors SPDR®		SPY	SPDR® S&P 500® ETF Trust
ASX	State Street Global Advisors SPDR®		SSO	SPDR® S&P®/ASX Small Ordinaries Fund
ASX	State Street Global Advisors SPDR®		STW	SPDR® S&P®/ASX 200 Fund
ASX	State Street Global Advisors SPDR®		SYI	SPDR® MSCI Australia Select High Dividend Yield Fund
ASX	State Street Global Advisors SPDR®		WDIV	SPDR® S&P® Global Dividend Fund
ASX	State Street Global Advisors SPDR®		WEMG	SPDR® S&P® Emerging Markets Carbon Control Fund
ASX	State Street Global Advisors SPDR®		WXHG	SPDR® S&P® World ex Australia Carbon Control (Hedged) Fund
ASX	State Street Global Advisors SPDR®		WXOZ	SPDR® S&P® World ex Australia Carbon Control Fund
ASX	The Perth Mint	Commodities	PMGOLD	Perth Mint Gold
ASX	VanEck	Alternative Assets - Carbon Credits	XCO2	Global Carbon Credits ETF (Synthetic)
ASX	VanEck	Alternative Assets - Gold	NUGG	Gold Bullion ETF
ASX	VanEck	Alternative Assets - Private Equity	GPEQ	Global Listed Private Equity ETF
ASX	VanEck	Equity - Australian Broad Based	MVW	Australian Equal Weight ETF
ASX	VanEck	Equity - Australian Equity Income	DVDY	Morningstar Australian Moat Income ETF
ASX	VanEck	Equity - Australian Sector	MVA	Australian Property ETF
ASX	VanEck	Equity - Australian Sector	MVB	Australian Banks ETF
ASX	VanEck	Equity - Australian Sector	MVR	Australian Resources ETF
ASX	VanEck	Equity - Australian Small & Mid Companies	MVE	S&P/ASX MidCap ETF
ASX	VanEck	Equity - Australian Small & Mid Companies	MVS	Small Companies Masters ETF
ASX	VanEck	Equity - Global Sector	GDX	Gold Miners ETF
ASX	VanEck	Equity - Global Sector	HLTH	Global Healthcare Leaders ETF
ASX	VanEck	Equity - Global Sector	IFRA	FTSE Global Infrastructure (Hedged) ETF
ASX	VanEck	Equity - Global Sector	REIT	FTSE International Property (Hedged) ETF
ASX	VanEck	Equity - International	CETF	FTSE China A50 ETF
ASX	VanEck	Equity - International	CNEW	China New Economy ETF
ASX	VanEck	Equity - International	EMKT	MSCI Multifactor Emerging Markets Equity ETF
ASX	VanEck	Equity - International	GOAT	Morningstar International Wide Moat ETF
ASX	VanEck	Equity - International	HVLU	MSCI International Value (AUD Hedged) ETF
ASX	VanEck	Equity - International	MHOT	Morningstar Wide Moat (AUD Hedged) ETF
ASX	VanEck	Equity - International	MOAT	Morningstar Wide Moat ETF
ASX	VanEck	Equity - International	QHAL	MSCI International Quality (Hedged) ETF
ASX	VanEck	Equity - International	QUAL	MSCI International Quality ETF
ASX	VanEck	Equity - International	VLUE	MSCI International Value ETF
ASX	VanEck	Equity - International Small Companies	QHSM	MSCI International Small Companies Quality (AUD Hedged) ETF
ASX	VanEck	Equity - International Small Companies	QSML	MSCI International Small Companies Quality ETF
ASX	VanEck	Equity - Sustainable Investing	ESGI	MSCI International Sustainable Equity ETF
ASX	VanEck	Equity - Sustainable Investing	GRNV	MSCI Australian Sustainable Equity ETF
ASX	VanEck	Equity - Thematic	CLNE	Global Clean Energy ETF
ASX	VanEck	Equity - Thematic	ESPO	Video Gaming and eSports ETF
ASX	VanEck	Fixed Income - Australian	1GOV	1-5 Year Australian Government Bond ETF
ASX	VanEck	Fixed Income - Australian	5GOV	5-10 Year Australian Government Bond ETF
ASX	VanEck	Fixed Income - Australian	FLOT	Australian Floating Rate ETF
ASX	VanEck	Fixed Income - Australian	PLUS	Australian Corporate Bond Plus ETF
ASX	VanEck	Fixed Income - Australian	XGOV	10+ Year Australian Government Bond ETF
ASX	VanEck	Fixed Income - Capital Securities	GCAP	Global Capital Securities Active ETF (Managed Fund)
ASX	VanEck	Fixed Income - Capital Securities	SUBD	Australian Subordinated Debt ETF
ASX	VanEck	Fixed Income - Global	EBND	Emerging Income Opportunities Active ETF (Managed Fund)
ASX	VanEck	Fixed Income - Global	TBIL	1-3 Month US Treasury Bond ETF
ASX	Vanguard	Diversified	VDBA	Diversified Balanced Index ETF
ASX	Vanguard	Diversified	VDCO	Diversified Conservative Index ETF
ASX	Vanguard	Diversified	VDGR	Diversified Growth Index ETF
ASX	Vanguard	Diversified	VDHG	Diversified High Growth Index ETF
ASX	Vanguard	Equities - Australian	VAS	Australian Shares Index ETF
ASX	Vanguard	Equities - Australian	VETH	Ethically Conscious Australian Shares ETF
ASX	Vanguard	Equities - Australian	VHY	Australian Shares High Yield ETF
ASX	Vanguard	Equities - Australian	VLC	MSCI Australian Large Companies Index ETF
ASX	Vanguard	Equities - Australian	VSO	MSCI Australian Small Companies Index ETF
ASX	Vanguard	Equities - International	VAE	FTSE Asia ex Japan Shares Index ETF
ASX	Vanguard	Equities - International	VEQ	FTSE Europe Shares ETF
ASX	Vanguard	Equities - International	VESG	Ethically Conscious International Shares Index ETF
ASX	Vanguard	Equities - International	VEU	All-World ex-U.S. Shares Index ETF (Unavailable on Vanguard Personal Investor)
ASX	Vanguard	Equities - International	VGAD	MSCI Index International Shares (Hedged) ETF
ASX	Vanguard	Equities - International	VGE	FTSE Emerging Markets Shares ETF
ASX	Vanguard	Equities - International	VGS	MSCI Index International Shares ETF
ASX	Vanguard	Equities - International	VISM	MSCI International Small Companies Index ETF
ASX	Vanguard	Equities - International	VMIN	Vanguard Global Minimum Volatility Active ETF (Managed Fund)
ASX	Vanguard	Equities - International	VTS	U.S. Total Market Shares Index ETF (Unavailable on Vanguard Personal Investor)
ASX	Vanguard	Equities - International	VVLU	Vanguard Global Value Equity Active ETF (Managed Fund)
ASX	Vanguard	Fixed Interest	VACF	Australian Corporate Fixed Interest Index ETF
ASX	Vanguard	Fixed Interest	VAF	Australian Fixed Interest Index ETF
ASX	Vanguard	Fixed Interest	VBND	Global Aggregate Bond Index (Hedged) ETF
ASX	Vanguard	Fixed Interest	VCF	International Credit Securities Index (Hedged) ETF
ASX	Vanguard	Fixed Interest	VEFI	Ethically Conscious Global Aggregate Bond Index (Hedged) ETF
ASX	Vanguard	Fixed Interest	VGB	Australian Government Bond Index ETF
ASX	Vanguard	Fixed Interest	VIF	International Fixed Interest Index (Hedged) ETF
ASX	Vanguard	Infrastructure	VBLD	Global Infrastructure Index ETF
ASX	Vanguard	Property	VAP	Australian Property Securities Index ETF

Commodities

 

 

 

 

Commodity	Category	Sub-Category
Adzuki Bean	Agricultural	Grains, Food and Fiber
Aluminium	Metals	Industrial
Aluminium Alloy	Metals	Industrial
Amber	Other	-
Brent Crude Oil	Energy	-
Cobalt	Metals	Industrial
Cocoa	Agricultural	Grains, Food and Fiber
Cocoa C	Agricultural	Grains, Food and Fiber
Corn	Agricultural	Grains, Food and Fiber
Cotton No.2	Agricultural	Grains, Food and Fiber
Ethanol	Energy	-
Feeder Cattle	Agricultural	Livestock and Meat
Frozen Concentrated Orange Juice	Agricultural	Grains, Food and Fiber
Gold	Metals	Precious
Gulf Coast Gasoline	Energy	-
Hardwood Pulp	Forest Products	-
Heating Oil	Energy	-
Lead	Metals	Industrial
Lean Hogs	Agricultural	Livestock and Meat
Live Cattle	Agricultural	Livestock and Meat
LME Copper	Metals	Industrial
LME Nickel	Metals	Industrial
Milk	Agricultural	Grains, Food and Fiber
Molybdenum	Metals	Industrial
Natural Gas	Energy	-
No 2. Soybean	Agricultural	Grains, Food and Fiber
Oats	Agricultural	Grains, Food and Fiber
Palladium	Metals	Precious
Palm Oil	Other	-
Platinum	Metals	Precious
Propane	Energy	-
Purified Terephthalic Acid (PTA)	Energy	-
Random Length Lumber	Forest Products	-
Rapeseed	Agricultural	Grains, Food and Fiber
RBOB Gasoline (Reformulated gasoline Blendstock for Oxygen Blending)	Energy	-
Recycled Steel	Metals	Industrial
Robusta Coffee	Agricultural	Grains, Food and Fiber
Rough Rice	Agricultural	Grains, Food and Fiber
Rubber	Other	-
Silver	Metals	Precious
Softwood Pulp	Forest Products	-
Soy Meal	Agricultural	Grains, Food and Fiber
Soybean Meal	Agricultural	Grains, Food and Fiber
Soybean Oil	Agricultural	Grains, Food and Fiber
Soybeans	Agricultural	Grains, Food and Fiber
Sugar No.11	Agricultural	Grains, Food and Fiber
Sugar No.14	Agricultural	Grains, Food and Fiber
Tin	Metals	Industrial
Wheat	Agricultural	Grains, Food and Fiber
Wool	Other	-
WTI Crude Oil	Energy	-
Zinc	Metals	Industrial

Derivatives

 

What are they?

Derivatives are financial instruments whose value is derived from the price of an underlying asset or index.

They are used for hedging, speculation, and arbitrage.

Below are some common derivatives, along with their definitions and uses:

 

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1. Futures Contracts

Definition: A futures contract is a standardized agreement to buy or sell an asset at a specific price at a future date. The contract is traded on an exchange.

 

Uses:

• Hedging: Producers or consumers of commodities use futures to lock in prices and reduce the risk of price fluctuations.
• Speculation: Investors can speculate on the future price movements of assets like commodities, currencies, or financial instruments.
• Arbitrage: Traders exploit price differences between futures contracts and the underlying asset or between different exchanges.

 

Example: A farmer may sell wheat futures to guarantee a price for their crop, while a speculator might buy wheat futures, betting that the price will rise.

 

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2. Options (Call and Put)

Definition: An option is a contract that gives the holder the right, but not the obligation, to buy or sell an underlying asset at a predetermined price (strike price) before or on a specified expiration date.

• Call Option: Gives the right to buy the underlying asset.
• Put Option: Gives the right to sell the underlying asset.

 

Uses:

• Hedging: Investors use options to protect their portfolios from adverse price movements. For example, buying put options on a stock can act as insurance against a decline in its price.
• Speculation: Options allow investors to take leveraged positions, betting on the direction of an asset’s price.
• Income generation: Writing options can generate income through premiums. For example, selling covered calls can produce extra income on an existing stock position.

 

Example: A call option on a stock gives the buyer the right to buy the stock at the strike price (e.g., $100) before the expiration date. If the stock price rises above $100, the buyer can profit by exercising the option or selling it at a higher premium.

 

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3. Swaps

Definition: A swap is a derivative contract in which two parties exchange cash flows or financial instruments over a specified period. Common types of swaps include:

• Interest Rate Swap: Exchange of fixed interest rate payments for floating rate payments.
• Currency Swap: Exchange of cash flows in one currency for cash flows in another currency.
• Commodity Swap: Exchange of fixed commodity prices for floating commodity prices.

 

Uses:

• Hedging: Companies use swaps to manage exposure to interest rate, currency, or commodity price fluctuations.
• Speculation: Investors might engage in swaps to bet on interest rate movements or currency exchange rates.
• Arbitrage: Swaps can be used to exploit discrepancies between market rates.

 

Example: A company with a variable-rate loan may enter into an interest rate swap to exchange its variable payments for fixed-rate payments, thereby reducing the uncertainty of its future interest costs.

 

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4. Exotic Options

Definition: Exotic options are more complex than standard options (calls and puts). They may have unique features, such as different payoff structures, underlying assets, or conditions for exercising the option. Some common types include:

• Barrier Options: Options that only become active or “knock in” once the price of the underlying asset reaches a certain threshold (barrier).
• Asian Options: Options where the payoff depends on the average price of the underlying asset over a specified period, rather than just its price at expiration.
• Digital Options: Also known as “all-or-nothing” options, these pay a fixed amount if the underlying asset reaches a certain price level at expiration.
• Lookback Options: Allow the holder to “look back” over the life of the option and choose the best price of the underlying asset (either maximum or minimum) to determine the payoff.

 

Uses:

• Hedging and Risk Management: Exotic options can offer tailored risk management solutions for specific situations.
• Speculation: Traders use exotic options to take highly leveraged, niche positions in the market.
• Customization: Companies or investors with unique risk profiles may use exotic options for more customized protection or speculative opportunities.

 

Example: A barrier option may be a “knock-in” call option, which becomes activated only if the underlying stock price rises above a certain level, providing a more cost-effective way to speculate on price movements than traditional options.

 

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5. Warrants

Definition: A warrant is a type of option issued by a company that gives the holder the right to buy shares of the company at a specific price (strike price) before a set expiration date. Warrants are typically issued in conjunction with bond or preferred stock offerings as an added incentive for investors.

 

Uses:

• Capital Raising: Companies issue warrants to raise capital, often as part of a new bond or equity issue.
• Speculation: Investors can buy warrants to speculate on the future price movement of a company’s stock.

 

Example: A company may issue a warrant that allows investors to buy shares at $50 each for the next five years. If the stock price rises above $50, the investor can exercise the warrant and buy shares at a discount.

 

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6. Forward Contracts

Definition: A forward contract is a private, non-standardized agreement between two parties to buy or sell an asset at a future date for a price agreed upon today. Unlike futures contracts, forwards are not traded on exchanges.

 

Uses:

• Hedging: Businesses use forward contracts to lock in the price of goods or currencies for future transactions.
• Speculation: Traders may speculate on the future price movements of assets by entering into forward contracts.

 

Example: A company that imports goods from another country may enter into a forward contract to lock in the exchange rate for the foreign currency it will need to pay in the future.

 

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7. Credit Default Swaps (CDS)

Definition: A credit default swap is a financial derivative that allows an investor to “swap” or transfer the credit risk of a reference entity (such as a corporation or government) to another party.

 

Uses:

• Hedging: Investors use CDS to protect against the risk of default on a bond or loan.
• Speculation: Traders may use CDS to speculate on the likelihood of default or credit events for a specific entity.

 

Example: An investor holding corporate bonds may buy a CDS as protection against the risk of the company defaulting on its debt.

 

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Conclusion

Derivatives are powerful financial tools that serve various purposes, from managing risk and hedging to enabling speculation and arbitrage. The choice of derivative depends on the specific needs of the market participants, whether it’s to manage the risk of price movements, take advantage of market inefficiencies, or enhance returns with leverage. While futures, options, swaps, and exotic options are some of the most commonly used derivatives, each type has unique features that make it more suitable for certain market conditions or objectives.

 

Dividends

 

Notes

A payment paid regularly by a company to its shareholders out of its profits (or reserves). Interim dividends are generally paid out of surplus profits (reserved) of the previous years, whereas final dividends are declared and paid out on an annual basis after the earnings are known for that financial year. Additionally, companies may pay a bonus dividend.

 

• Interim Dividend
• Bonus Dividend
• Final Dividend

 

A company typically divides its profits between itself and its shareholders. Distributions represent a portion of the profits a company decides to give to its shareholders, while retained earnings represent the portion of profits that a company chooses to keep. Companies choose to share profits in the form of dividends because it encourages shareholders to continue investing in the company. Understanding the transactions pertaining to dividends and retained earnings helps you know the effects of the transactions on a company’s financial statements.

 

 

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Ex-Dividend Date

The ex-dividend date occurs one business day before the company’s Record Date.

Important: To be entitled to the dividend, the buyer needs to purchase the shares prior to the ex-dividend date! If you purchase shares on the ex-dividend date, the seller will be entitled to the dividend payment.

 

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Record Date

The record date is 5.00pm on the date a company closes its share register to determine which shareholders are entitled to receive the current dividend. It is the date where all changes to registration details must be finalised.

 

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Dividend Entitlement

 

 

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Formula

 

$$\begin{aligned} Dividend\;Yield\; &=\;\left [ (Interim\;Dividend + Final\;Dividend) \over Current\;Share\;Price\right ] \;*\;100\;\\\\\ &= \;\left [ Dividends \over Current\;Share\;Price \right ] \;*\;100\;\end{aligned}$$

 

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Dividend Yield

 

 

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See also: Franking (Imputation) Credits

Dow Jones Industrial Average (DJIA)

 

Notes

• Foundation: 16 February 1885
• Operator: S&P Dow Jones Indices
• Exchanges: New York Stock Exchange (NYSE), NASDAQ (NAS)
• Trading Symbol:  ^DJI
• Constituents:  30
• Type:  Large Cap
• Market Cap: US$19.43 trillion (Nov. 2024)
• Weighting Method:  Price-Weighted Index
• Website:  S&P Dow Jones Indices

 

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Index

Rank	Symbol	Name	Market Capitalisation (USD$ Billions)
1	NVDA	NVIDIA Corporation	3,563.23
2	AAPL	Apple Inc.	3,389.42
3	MSFT	Microsoft Corporation	3,107.85
4	AMZN	Amazon.com, Inc.	2,174.92
5	WMT	Walmart Inc.	676.90
6	JPM	JPMorgan Chase & Co.	673.68
7	V	Visa Inc.	590.13
8	UNH	UnitedHealth Group Incorporated	575.41
9	HD	The Home Depot, Inc.	405.55
10	PG	The Procter & Gamble Company	391.01
11	JNJ	Johnson & Johnson	373.28
12	CRM	Salesforce, Inc.	326.69
13	CVX	Chevron Corporation	281.24
14	KO	The Coca-Cola Company	272.94
15	MRK	Merck & Co., Inc.	254.81
16	CSCO	Cisco Systems, Inc.	233.98
17	MCD	McDonald's Corporation	216.08
18	AXP	American Express Company	206.38
19	GS	The Goldman Sachs Group, Inc.	198.30
20	IBM	International Business Machines Corporation	197.48
21	CAT	Caterpillar Inc.	191.45
22	DIS	The Walt Disney Company	183.16
23	AMGN	Amgen Inc.	172.98
24	VZ	Verizon Communications Inc.	170.24
25	HON	Honeywell International Inc.	146.46
26	NKE	NIKE, Inc.	114.02
27	BA	The Boeing Company	111.36
28	SHW	The Sherwin-Williams Company	97.70
29	MMM	3M Company	72.43
30	TRV	The Travelers Companies, Inc.	58.65

 

Options

 

Notes

 

Options are contracts where you have the right but not the obligation to either buy (call ) or sell (put) financial instruments at the exercise (strike) price on or before a predetermined date.

 

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Types

 

1. American
   • • Can exercise the option any time up to the expiration date.
     • Higher risk to the seller (writer).
     • More expensive (premium) than the European type option.
     • Options traded on the ASX are predominantly American type.
2. European
   • • Can exercise the option only on the contract expiration date.
     • Lower risk to the seller (writer).
     • Less expensive (premium) than the American type option.

 

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Strategies

 

• Vertical Bull Spread
• Call Bull Spread
• Vertical Bear Spread
• Put Bear Spread
• Straddle
  • • Long Straddle
    • Short Straddle
• Strangle
  • • Long Strangle
    • Short Strangle
• Barrier Option
  • • Knock-Out
    • Knock-In

 

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• 1 Option Contract: 100 Shares
• Seller (Writer):
• Buyer (Taker):
• Call (Buy) Option: The right but not obligation to buy the financial instrument at the exercise (strike) price.
• Put (Sell) Option: The right but not obligation to sell the financial instrument at the exercise (strike) price.
• Premium:
  • • How much you pay for the contract.
    • The level of risk is reflected in the premium of the option.
• Exercise (Strike) Price: The agreed price on the contract.
• Moneyness:
  • • In The Money (ITM): Profit
    • The Strike Price of a CALL OPTION is below the market price.
    • At The Money (ATM): Break-Even
    • Out of The Money (OTM): Loss
    • Deep In The Money: Large Gain
    • An option that would lead to a large profit if it were exercised
• Covered Option: The writer owns stock to be able to fulfill the contract.
• Naked Call Option: The writer does not own stock to fulfill the contract which is underwritten by a third party.
• Option Contracts:
  1. 1. Exchange Traded Options (ETOs)
     2. Over-The-Counter (OTC)
• Intrinsic Value
• Price Volatility

 

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• Issued By:
• Issued To:
• Type of Security:
• Duration:
• Source:
• Market:
• Return:
• Principle:
• Liquidity:
• Risk Level:

 

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Calculation

 

$$V = max(S-X, 0)-P $$

 

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Long Call

 

 

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Short Call

 

 

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Long Put

 

 

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Short Put

 

 

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Long Straddle

 

• Strategy: Neutral
• Conditions: High Volatility
• Buy:
  • • 1 ATM CALL
    • 1 ATM PUT
• Time Decay: Negative impact
• Break Even Points: Long Call – Premium, Long Call + Premium
• Max. Loss: Limited
• Max. Profit: Unlimited

 

 

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Short Straddle

 

• Strategy: Neutral
• Conditions: Low Volatility
• Sell:
  • • 1 ATM CALL
    • 1 ATM PUT
• Time Decay:
• Break Even Points:
• Max. Loss: Unlmited
• Max. Profit: Limited

 

 

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Long Strangle

 

With this strategy, a trader is looking for a major move; either up or down in the underlying stock before expiration. This market neutral strategy is specifically designed for high volatility conditions where stocks are swinging wildly back and forth.

 

• Strategy: Neutral
• Conditions: High Volatility
• Buy:
  • • 1 OTM CALL
    • 1 OTM PUT
• Time Decay:
• Break Even Points:
• Max. Loss: Limited
• Max. Profit: Unlimited

 

 

 

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Short Strangle

 

• Strategy: Neutral
• Conditions: Low Volatility
• Sell:
  • • 1 OTM CALL
    • 1 OTM PUT
• Time Decay:
• Break Even Points:
• Max. Loss: Unlimited
• Max. Profit: Limited

 

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