The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both. Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

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Chapter 22, Problem 3CP

Summary Introduction

To explain: The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both.

Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

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Question

Chapter 22, Problem 3CP

Summary Introduction

To explain: The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both.

Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

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Answer 3

Question

Chapter 22, Problem 3CP

Summary Introduction

To explain: The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both.

Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

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Answer 4

Question

Chapter 22, Problem 3CP

Summary Introduction

To explain: The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both.

Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

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Answer 5

Chapter 22, Problem 3CP

Summary Introduction

To explain: The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both.

Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

Answer 6

Chapter 22, Problem 3CP

Summary Introduction

To explain: The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both.

Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

Answer 7

Chapter 22, Problem 3CP

Summary Introduction

To explain: The Comparison between futures contract and option contract and also explain that portfolio risk which can be modified by both.

Introduction: When the commodities are buying or selling at a predetermined value but for the future time this dealing is called future trading but call option provides a right to the buyer. If the trading conditions are not profitable then he will not exercise the option price.

Answer 8

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Ch. 22 - Prob. 1PS Ch. 22 - Prob. 2PS Ch. 22 - Prob. 3PS Ch. 22 - Prob. 4PS Ch. 22 - Prob. 5PS Ch. 22 - Prob. 6PS Ch. 22 - Prob. 7PS Ch. 22 - Prob. 8PS Ch. 22 - Prob. 9PS Ch. 22 - Prob. 10PS

Solution Summary: The author explains the difference between futures contract and option contract. Future contract is a combined agreement for the future date, but call option is only for favorable conditions.

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Chapter 22 Solutions