What are the jumps?
Long -term foreshadowing of equity or jumps is the own capital, index and sector with very long expiry conditions. The Chicago Board Options Exchange (CBE) was created to offer investors an alternative with long -term investment strategies.
CBOE offers a comprehensive selection of jumps. Index jumps are available for the main indices in the US, such as the industrial average Dow Jones, S&P 500 and NASDAQ 100, as well as international standards covering markets in China, Europe, Japan and Mexico. Similar securities for industries have also been introduced, which include banking services, oil services, telecommunications, health care and other important elements of the economy. Stock jumps are available for individual companies. Details of current offers can be obtained from CBE. While the traditional capital options are available with expirations ranging from one to three months, these securities have conditions expanding up to three years. To dIsposition is PUT and call options. Index jumps are generally in the European style and can only be applied after. Shares jumps are generally in American style and can be performed at any time before expiration.
Leaps can be appreciated using Black-Scholes Awards and can be traded using the same strategies as more traditional options. Investors can buy jumps to protect long -term stock positions or buy call jumps if they expect a long -term bull market. With the span, current purchase and sale of possibilities at different strikes, it is also possible to implement this type of security, as well as the strategy designed to benefit from changes in market volatility.
The long -term period of expiration of jumps introduction. They are highly sensitive to interest rates that are likely to change throughout the life of a jump. For example, in a growing interest environment, jumps can actually trade with nEgative money value. This is particularly important for jumps of equity, because there are strong motivation to hold the time to choose early exercise.