A transaction that, as opposed to a direct hedge, involves hedging one commodity with a contract for a different commodity....
A derivative instrument which cannot be perfectly hedged using available exchange-traded instruments. In other words, the risks associated with such...
A binary credit default swap. Unlike standard credit default swaps (CDS) which require a valuation following a credit event (usually...
A modified version of the barrier cap. It is an interest rate cap that comes in the form of an...
A second-order greek that measures the instantaneous rate of change of an option’s delta with respect to the passage of time. In other words,...
A change in the sensitivity of an option (or generally a derivative) with the passage of time, holding everything else constant (e.g., volatility)....
The delta value of a derivative or a position multiplied by the notional principal. It is the delta hedge of a derivative position expressed in dollars. This...
A call or put option whereby the holder has the retroactive right to purchase (if a call) or sell (if...
The reverse of an accumulator. More specifically, it is a structured product that involves investors taking on the obligation to...