Meaning PUT-CALL PARITY RELATIONSHIP: The relationship between the price of a put and the price of a call on the same underlying security with the same expiration date, which prevents arbitrage opportunities. Holding the underlying stock and buying a put will deliver the exact payoff as buying one call and investing the present value (PV) of the exercise price. The call value equals C = S + P - PV(k)
More terms such as Put-call parity relationship in Dictionary P.
- Definition Principle Of Diversification:
- Examples different sorts of assets differently correlated with one another will have negligible unsystematic risk. In other words, unsystematic risks disappear in diversified portfolios, and only systematic put-call parity relationship definition.
- Definition Preemptive Right:
- Examples Common stockholders' right to anything of value distributed by the company put-call parity relationship explain.
- Definition Public Debt:
- Examples Issues of debt by governments to compensate for a lack of tax revenues put-call parity relationship what is.
- Definition Purchase Fund:
- Examples Resembles a sinking fund, except that money is used to purchase bonds only if they are selling below their par value put-call parity relationship meaning.
- Definition Perpendicular Spread:
- Examples Option strategy involving the purchase of options with similar expiration dates and different exercise prices put-call parity relationship abbreviation.