What is the possibility of dependent on the way?
The option to the journey is the type of investment opportunity that will generate revenues based on the expected changes in the price over a period of time. This is unlike investments that are known as direct options that are based on the value of the asset that is the basis of the option, either at the time when the possibility is called or achieves expiration data. There are a number of different types of options that are considered to be a journey -dependent journey, including lookback, barrier and Asian options.
Defining the characteristic of the dependent on the way is that the derived benefits are directly associated with the movement or path that the value of the underlying asset lasts for the time the investor intends to maintain this asset. This movement allows you to set requirements for the price at specific time points during this period, with the potential to either earn or lose money along the way. Assuming my investor or forever predicted what will probably happen on each of these price pointsIla to generate a significant amount of income from possession is very high.
It is important to realize that the accurate projection of the path that the prices for the basic asset is doing is essential if the investor is to earn money from the possibility of dependent on the way. This means that instead of taking care of what the price will be at the end of the considered period, it is also necessary to reflect what will happen to this price for predetermined points between the date of the asset obtained and the date when the investment is called or achieves expiry. While a more intense process that goes with direct options is the potential to generate yields with this approach extremely high.
, along with potential yields that may come from the right assessing path of prices on the underlying asset, there is a certain degree of risk associated with the possibility of dependent on the road. Unexpected market changes that affect these price movements can lead tolosses. Failure to take into account all known factors when considering this type of purchase will lead to incomplete projections that could be very expensive. Although potential yields are excellent when predictions are accurate, these returns can be significantly reduced when the decision to go with the possibility of dependent on the road is based more on intuition than in fact grounded projections.