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Derivatives




Bear Fence


A fence whereby a put option is long (long put) and a call option is short (short put), both being struck out-of-the money and expiring on the same date (expiration date).

For example, an investor may buy 1 September 85 put for $2 and sell 1 September 90 put for $2.



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Derivatives have increasingly become very important tools in finance over the last three decades. Many different types of derivatives are now traded actively on ...
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