Black scholes model for binary option used for21 comments
Binary options trading 2018 master
Most people are convinced that futures are more volatile than stocks; however, the facts belie this notion. The following table illustrates the point:. That is, the stock market was 2 to 7 times more volatile than the commodities market. So why do many people believe futures are more volatile than securities? Because of the leverage employed in the futures markets. In the futures markets, the margin is an earnest money deposit, with no funds borrowed from the broker.
In other words, the customer is liable for the entire contract value. Because of the lower margin requirements for futures, there is greater leverage in the futures markets than in the securities markets. A small change in the value of the total contract translates into a large percentage gain on the margin deposited. In conclusion, futures prices are actually less volatile than securities prices; however, the leverage stemming from lower margin requirements magnifies what volatility there is.
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The information on this web site is not to be construed as trading advice, and should not be relied upon for timeliness as its availability cannot be guaranteed. Terms of Service and Conditions of Use. Search our online store: Exam Series 30 Series 30 Supp. Exam Series 31 Series 34 Series 65 Ethics Training Online Booklets Quick Links Articles Multi-language Futures Glossary Securities Glossary FOREX Glossary Contact Us FAQ Center for Futures Education, Inc. The following table illustrates the point: Log-In to Products Series 3 Series 3 Supp.
Exam Series 31 Series 34 Series 65 Ethics Training Online Booklets Quick Links Articles Multi-language Futures Glossary Securities Glossary FOREX Glossary Contact Us FAQ