Theta |
The price of options and warrants consists of their time value and intrinsic value. Time value gradually deteriorates during the term to expiry and accelerates shortly before the expiry date to ultimately end at 0. Theta is one of the dynamic coefficients for options and represents the extent to which an option/warrant loses time value when all other price-influencing factors remain constant. Theta is normally expressed in % per week.
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Time value |
The price of an option/warrant consists of two components: "time value" and "intrinsic value". The time value portion is not only influenced by the price movements in the underlying instrument, but also by changes in other factors such as volatility, interest rates and dividends.
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Tracker certificate |
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Twin-win certificate |
With twin-win certificates, investors can potentially profit from rising as well as falling prices. However, if the price of the underlying instrument declines dramatically, the threat exists that a predetermined safety threshold is breached. In such an event, heavy losses could be incurred.
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