Ricki

What Is an Exchange Traded Derivative?

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An exchange traded derivative is a financial instrument that derives its value from an underlying asset. The most common types of derivatives are futures contracts and options contracts. These contracts are traded on exchanges, and the prices of these contracts are determined by the supply and demand of the participants in the market. Derivatives are … Read more

Binomial Tree.

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A binomial tree is a model used to price options. The model assumes that the underlying asset price can either go up or down over a given period of time, and that each period has the same length of time. The model is used to price options by using a recursive algorithm. The algorithm starts … Read more