SUBMITTED TO:

Institute of Company Secretaries of India

ICSI HOUSE, 22, Institutional Area, Lodi Road,
New el!i " ##$$$%
SUBMITTED BY:

Name & 'atin A( 'ain
REGISTRATION NO. : WRO418697/08/2005
1
INDEX
Sr.
No.
Particulars Page
No.
1. Introduction to Derivaives
4
2. Introduction to Future
11
3. Introduction to Options
14
4. Black Scholes
34
5. Financial Risk Manae!ent
3"
". Bi#lioraph$ % &e#oraph$
3'
2
Executive Summary
(e) ideas and innovations have al)a$s #een the hall!ark o* proress
!ade #$ !ankind. +t ever$ stae o* develop!ent, there have #een t)o
core *actors that drives !an to ideas and innovation. -hese are
increasin returns and reducin risk, in all *acets o* li*e.
-he *inancial !arkets are no di**erent. -he endeavor has al)a$s #een to
!a.i!i/e returns and !ini!i/e risk. + lot o* innovation oes into
developin *inancial products centered on these t)o *actors. It has
spa)ned a )hole ne) area called *inancial enineerin.
Derivatives are a!on the *ore*ront o* the innovations in the *inancial
!arket sand ai! to increase returns and reduce risk. -he$ provide an
outlet *or investors to protect the!selves *ro! the vaaries o* the
*inancial !arkets. -hese instru!ents have #een ver$ popular )ith
investors all over the )orld.
Indian *inancial !arkets have #een on the ascension and catchin up
)ith lo#al standards in *inancial !arkets. -he advent o* screen #ased
tradin, de!ateriali/ation, rollin settle!ent has put our !arkets on par
)ith international !arkets. +s a loical step to the a#ove proress,
derivative tradin )as introduced in the countr$ in 0une 2111. Startin
)ith inde. *utures, )e have !ade rapid stride and have *our t$pes o*
derivative products% Inde. *uture, inde. option, stock *uture and stock
options. -oda$, there are 51 stocks on )hich one can have *utures and
options, apart *ro! the inde. *utures and options.

3
4
DERIVATIVES
+ derivative is a *inancial instru!ent that derives its value *ro! an
underl$in asset. -his underl$in asset can #e stocks, #onds, currenc$,
co!!odities, !etals and even intani#le, pseudo assets like stock
indices. Si!pl$ )e can sa$ that derives so!e thin *ro! so!eone.
In the Indian conte.t the Securit$ 2ontract +ct, 1'5" de*ines
3derivative4 to include5
16 + securit$ derived *ro! a de#t instru!ent, shares, and loans
)hether secured or unsecured, risk instru!ent or contract *or
an$ other *ro! o* securit$.
26 + contract )hich derives its value *ro! o* securit$.
What is a derivative instrument?
It is a contract )hose value depends on or derives *ro! the value o* an
underl$in asset 7sa$ a share, *ore., co!!odit$ or an inde.8. In its
#roadest sense a derivative atte!pts to hede aainst the varia#ilit$ o*
an$ econo!ic varia#le. -hus e.posures or perceived risks to a *ir!
arisin *ro! the variation in interest rates, e.chane rates, co!!odit$
prices and e9uit$ prices can #e heded throuh an appropriate derivative
structure. Such a derivative structure covers a )ide variet$ o* *inancial
contracts vi/. Futures, For)ards, Options, S)aps and di**erent
variations thereo*. -hese contracts can #e traded on the various
:.chanes in a standardi/ed !anner or #$ custo! desined *or
individual re9uire!ents.
-he *our i!portant t$pes o* derivatives are #ased on the *ollo)in5
I6 Bonds )hich var$ in price accordin to interest rates
II6 2urrencies
III6 :9uities includin stock indices
I;6 2o!!odities like !etals, oil and aricultural produce
Advantages o Derivatives
Derivatives are i!portant *inancial instru!ent and per*or! a )ide
variet$ o* *unctions. Fro! an investor<s point o* vie), derivatives o**er
a hue nu!#er o* opportunities, )hether he is risk%taker or risk averse.
So!e o* the i!portant advantaes are as *ollo)5
5
Hedging Risk
Derivatives are use to hede risks. -he$ can #e used as hedin devices
#$ retail investors, port*olio !anaers and #orro)ers hedin aainst
interest rate rise. Inde. *utures can #e used to hede a port*olio aainst
adverse !ove!ent in the stock !arket
Expanding portfolio
Derivatives ena#le #anks, traders or investors to #e on price !ove!ent
)ithout havin to deal )ith actual assets, i* the value o* the underl$in
oes up or do)n, the di**erence is si!pl$ settled in cash. Derivatives are
!ore *le.i#le than the underl$in products.
Power to leverage
Derivatives allo) investor to take position o* a lare value #$ !akin a
s!all invest!ent. In *utures, one takes a position #$ pa$in a !arin in
the rane o* 25%31=. In case o* an option, one pa$s a pre!iu! that is a
ver$ s!all a!ount relative to the spot price and takes position in the
!arkets.
Power to defer
-he cash !arkets have a dail$ settle!ent !echanis!. + speculator
)antin to take a position in a stock has to either take deliver$ or s9uare
o** his position the sa!e da$. -hus he is una#le to take a position
#e$ond a da$.
Power to lend or borrow from the markets
&ith *utures, one can lend or #orro) *unds *ro! the !arket. -his )ill
#eco!e !ore e**ective )hen actual deliveries are introduced in the
derivatives !arkets.
In case $ou need !one$ *or short%ter! re9uire!ents, $ou can sell $our
stocks in the cash !arket and #u$ Futures. >ou et the li9uidit$ *or
so!e ti!e and then $ou can et $our stock #ack )hen the *utures are
settled.
!ommon Derivative !ontracts
"
Forward
+ *or)ard contract is an aree!ent in )hich t)o parties aree to under
take an e.chane o* the underlin asset at so!e *uture date at pre%
deter!ined price. + *or)ard contract is custo!i/ed contact #et)een t)o
parties, )here settle!ent takes place on a speci*ic date. -he settle!ent
date and price are areed in advance #$ the parties concerned.
Features of forward contract:
-he$ are #ilateral contract and hence e.posed to counter%part$ risk.
:ach contract is custo! desined and hence is uni9ue in ter! o*
contract si/e, e.piration date and the assets t$pe and 9ualit$.
-he contract price is enerall$ not availa#le in pu#lic do!ain.
-he contract price has to #e settled #$ deliver$ o* the assets on
e.piration date.
In the case the part$ )ishes to reverse the contract it has to
co!pulsoril$ o to the sa!e counter%part$.
For)ard contact is popular in the *orein e.chane !arket and
ariculture sector )here co!!odit$ prices *luctuate a reat deal. I* the
*or)ard contract is close #e*ore the scheduled closin date, a penalt$
!a$ #e chared. -he dra)#ack o* *or)ard contract is lack o*
standardi/ation )hich prevents tradin on an e.chane and the risk o*
de*ault.
Futures

Futures are aree!ents #et)een t)o parties to undertake a transaction at
an areed price on a speci*ic *uture date. Futures contract are e.chaned
#ased instru!ent, )hich are traded on a reulated e.chane. In eneral,
*uture contract are related to various underl$in assets such as
co!!odities, !arket indices, interest rate and so on.
In the *utures, there is an aree!ent to #u$ or sell a speci*ied 9uantit$ o*
*inancial instru!ent co!!odit$ on a desined *uture date, a price
areed upon #$ the #u$er and seller toda$.
e.g. I* $ou #u$ 111 co!pan$ ? *utures at 111 Rs. *or !arch 31 deliver$
it !eans that on 31 !arch, $ou )ould pa$ the seller Rs.11111 and et
return 111 shares o* co!pan$ ?. In eneral there is no ph$sical deliver$
o* the underl$in assets #ut the settle!ent is done #$ pa$in or
receivin the di**erence o* the actual price on March 31 and contracted
price. (o) suppose on the 31 !arch price o* co!pan$ ? )as 151 .$ou
@
)ould et Rs. 5111 and i* the price o* co!pan$ . )as Rs. @1 then $ou
)ould to pa$ Rs.3111.
-he standardi/ed ite! in an$ *utures contract is as *ollo)s.
Auantit$ o* the underl$in
-he date and !onth o* deliver$
-he unit o* price 9uotation and !ini!u! chane in price
Bocation o* settle!ent

In eneral !ost *utures contracts are not held to e.pir$, and so deliver$
does no take place. Open positions are closed out on the last da$ o*
tradin at a price deter!ined #$ the spotCcash !arket price o* the
underl$in asset. -he price is called 3e.chane deliver$ settle!ent
price4 or :DSD.
!ption
-he #u$er o* an option has the riht #ut not the o#liation to #u$ or sell
an areed a!ount o* a co!!odit$ on or #e*ore a speci*ied *uture date.
+n option to #u$ is kno) as a 3call4 option )hile an option to sell is
kno)s as a 3put< option. -he rate at )hich the #u$er o* the option has
the riht to #u$ or sell is the 3stri"e4 or 3e#ercise4 price.
S"#PS
+ S)aps can #e de*ined as an e.chane o* o#liation #$ t)o parties *or
instance in an interest rate S)ap EIRS6, one co!pan$ arranes )ith
another to e.chane interest rate pa$!ent.
-here are !an$ t$pes o* S)aps like +ssets S)ap, 2urrenc$ s)aps and
so on. -he !ost i!portant one is an interest rate S)aps EIRS6 and
2urrenc$ S)aps.
Interest Rate s$a% &IRS'
!urrenc( s$a%s.
!APS
)loors and !ollars
Warrants
F
I(-RODG2-IO(
-O
FG-GR:
INTR*D+!TI*N T* )+T+RE
'
)uture is a trade $hose settlement is going to ta"e %lace in
the uture.

Future
+ *uture is si!ilar to a *or)ard rate aree!ent, e.cept that it is not a
neotiated contracted #ut a standard instru!ent.
+ *uture is a contract to #u$ or sell an asset at a speci*ied *uture date at a
Speci*ied price. -hese contracts are traded on the stock e.chanes and it
can chane !an$ hands #e*ore *inal settle!ent is !ade. -he advantae
o* a *uture is that it eli!inates counterpart$ risk. Since there is an
e.chane involved in #et)een, and the e.chane uarantees each trade,
the #u$er or seller does not et a**ected )ith the opposite part$
de*aultin.
Futures Forwards
-here are t)o kinds o* *utures traded in the !arket% inde. *utures and
stock *utures. -here are three t$pes o* *utures #ased on the tenure. -he$
are 1, 2 or 3%!onths *uture.
$ndex Futures
Inde. *utures are *utures contract on the inde. itsel*. One can #u$ a 1, 2
or 3% !onth inde. *uture. I* so!eone )ants to take a call on the inde.,
then inde. *utures are the ideal instru!ents *or hi!. Bet us tr$ and
understand )hat an inde. is. +n inde. is a set o* nu!#ers that represent
a chane over a period o* ti!e.
Stock Future
Stock *uture !eans dealin in speci*ic scrip. :.. i* $ou #u$ or sell
Reliance *uture it called stock *uture.
%erminologies used in a Futures contract
-he ter!inoloies used in a *utures contract are
a6 S%ot Price, -he current !arket price o* the scripCinde.
#6 )uture Price, -he price at )hich the *utures contract trades in the
*utures !arket
11
c6 Tenure, -he period *or )hich the *uture is traded
d6 E#%ir( date, -he date on )hich the *utures contract )ill #e settle
e6 -asis , -he di**erence #et)een the spot price and the *uture price
*6 !ontact si.e, -he a!ount o* assets )ill #e delivered under one
contract. For instances contract si/e o* (S:< Inde. *uture is 211
(i*ties.
6 Initial margin, -he a!ount that !ust #e deposited in the !arin
account at the ti!e o* the *uture contract it is kno)n as initial
!arin.
h6 /ar"0to0mar"et, In the *uture !arket, at the end o* each da$, the
!arin account is adHusted to re*lect the investor<s ain or loss
dependin upon *uture closin price. -his is called !ark%to%!arket.
INTR*D+!TI*N
T*
11

*PTI*NS
12
$&%R!'()%$!& %! !P%$!&S
!ptions
+s seen earlier, *utures are derivative instru!ents )here one can take a
position *or an asset to #e delivered at a *uture date. But there is also an
o#liation as the seller has to !ake deliver$ and #u$er has to take
deliver$.
Options are one #etter than *utures. In option, as the na!e indicates,
ives one part$ the option to take or !ake deliver$. But this option is
iven to onl$ one part$ in the transaction )hile the other part$ has an
o#liation to take or !ake deliver$. -he asset can #e a stock, #ond,
inde., currenc$ or a co!!odit$ #ut since the other part$ has an
o#liation and a risk associated )ith !akin ood the o#liation, he
receives a pa$!ent *or that. -his pa$!ent is called as pre!iu!.
-he part$ that had the option or the riht to #u$Csell enHo$s lo) risk. -he
cost o* this lo) risk is the pre!iu! a!ount that is paid to the other
part$.
%he benefits of !ptions are as under:
Iih leverae as #$ investin s!all a!ount o* capital Ein *or! o*
pre!iu!6, one can take e.posure in the underl$in asset o* !uch
reater value.
Dre%kno)n !a.i!u! risk *or an option #u$er
Bare pro*it potential and li!ited risk *or option #u$er
One can protect his e9uit$ port*olio *ro! a decline in the !arket #$
)a$ o* #u$in a protective put )here in one #u$s puts aainst an
e.istin stock position.
-his option position can suppl$ the insurance needed to overco!e
the uncertaint$ o* the !arketplace. Ience, #$ pa$in a relativel$
s!all pre!iu! Eco!pared to the !arket value o* the stock6, an
investor kno)s that no !atter ho) *ar the stock drops, it can #e sold
at the strike price o* the Dut an$ti!e until the Dut e.pires.
)all option
+ call option ives the holder a riht to #u$ shares. -he option holder
)ill !ake !one$ i* the spot price is hiher than the strike price. -he pa$
o** assu!es that the option holder )ill #u$ at the strike price and sell
i!!ediatel$ at the spot price. But i* the spot price is lo)er than the
strike, the option holder can si!pl$ inore the option. It )ill #e cheaper
13
to #u$ *ro! the !arket. -he option holder loss is to the e.tent o*
pre!iu! he has paid.
But i* the spot price increases dra!aticall$ then he can !ake )ind *all
pro*its. -hus the pro*it *or an option holder in a call option is unli!ited
)hile losses are capped to the e.tent o* the pre!iu!.
Put option
-he put option ives the riht to sell. -he option holder )ill !ake
!one$ i* the spot price is lo)er than the strike price. -he pa$ o**
assu!es that the option holder )ill #u$ at spot price and sell at the strike
price
But i* the spot price is hiher than the strike, the option holder can
si!pl$ inore the option. It )ill #e #ene*icial to sell to the !arket. -he
option holder loss is to the e.tent o* pre!iu! he has paid. But i* the
spot prices *all dra!aticall$ then he can !ake )ind *all pro*its.
-hus the pro*it *or an option holder in a put option is unli!ited )hile
losses are capped to the e.tent o* the pre!iu!. -his is a theoretical
*allac$ as the !a.i!u! *all a stock can have is till /ero, and hence the
pro*it o* a option holder in a put option is capped. 2onversel$, the
!a.i!u! pro*it that an option )riter can !ake in this case is the
pre!iu! a!ount. But in the a#ove pa$ o**, )e had inored certain costs
like pre!iu! and #rokerae. -hese are also i!portant, especiall$ the
pre!iu!.
I* the spot is !ore than the strike price #ut less than the su! o* strike
price and pre!iu!, the option holder can !ini!i/e losses #ut cannot
!ake pro*its #$ e.ercisin the option. Si!ilarl$, *or a put option, the
option holder !akes !one$ i* spot is less than the strike price less the
pre!iu! a!ount.
I* the spot is less than the strike price #ut !ore than the strike price less
pre!iu!, the option holder can !ini!i/e losses #ut cannot !ake
pro*its #$ e.ercisin the option
!ption premium

In practice, it is the !arket that decides the pre!iu! at )hich an option
is traded. -here are !athe!atical !odels, )hich are used to calculate
the pre!iu! o* an option.
14
-he si!plest tool is the e#%ected value conce%t.
For e.a!ple, *or a stock that is 9uotin at Rs '5. -here is a 21 =
pro#a#ilit$ that it )ill #eco!e Rs 111. -here is a 31 = pro#a#ilit$ that it
)ill #eco!e Rs 115. -here is 31= pro#a#ilit$ that the stock )ill re!ain
at Rs.'5 and a 21 = pro#a#ilit$ that it )ill *all to Rs '1. I* the strike
price o* a call option is to #e Rs 111, then the option )ill have value
)hen the spot oes to Rs 115 or Rs 111. It )ill #e un% e.ercised at Rs '5
and Rs '1.
I* it is Rs115 and Rs 111, the !one$ !ade is Rs 11 and 15 respectivel$.
-he e.pected returns *or the a#ove distri#ution is 1.21J15K1.31J11LRs
".
-hus this the price that one can pa$ as a pre!iu! *or a strike price o* Rs
111 *or a stock tradin at Rs '5. Rs " )ill also #e the price *or the seller
*or ivin the option holder this opportunit$.
-his is a ver$ si!ple thu!# calculation. :ven then, one )ould re9uire a
lot o* #ackround data like variances and e.pected price !ove!ents.
%he basic trades of stock options
-hese trades are descri#ed *ro! the point o* vie) o* a speculator. I* the$
are co!#ined )ith other positions, the$ can also #e used in hedin.
*ong )all
Payoffs and profits from a long call+
+ trader )ho #elieves that a stockMs price )ill increase !iht #u$ the
riht to purchase the stock Ea call option6 rather than Hust #u$ the stock.
Ie )ould have no o#liation to #u$ the stock, onl$ the riht to do so
until the e.piration date. I* the stock price increases over the e.ercise
price #$ !ore than the pre!iu! paid, he )ill pro*it. I* the stock price
decreases, he )ill let the call contract e.pire )orthless, and onl$ lose the
a!ount o* the pre!iu!. + trader !iht #u$ the option instead o* shares,
#ecause *or the sa!e a!ount o* !one$, he can o#tain a larer nu!#er
o* options than shares. I* the stock rises, he )ill thus reali/e a larer
ain than i* he had purchased shares.
Short )all
15
Da$o**s and pro*its *ro! a naked short call.
+ trader )ho #elieves that a stock price )ill decrease, can short sell the
stock or instead sell a call. Both tactics are enerall$ considered
inappropriate *or s!all investors. -he trader sellin a call has an
o#liation to sell the stock to the call #u$er at the #u$erMs option. I* the
stock price decreases, the short call position )ill !ake a pro*it in the
a!ount o* the pre!iu!. I* the stock price increases over the e.ercise
price #$ !ore than the a!ount o* the pre!iu!, the short )ill lose
!one$, )ith the potential loss unli!ited.
*ong Put
Da$o**s and pro*its *ro! a lon put.
+ trader )ho #elieves that a stockMs price )ill decrease can #u$ the riht
to sell the stock at a *i.ed price Ea put option6. Ie )ill #e under no
o#liation to sell the stock, #ut has the riht to do so until the e.piration
date. I* the stock price decreases #elo) the e.ercise price #$ !ore than
the pre!iu! paid, he )ill pro*it. I* the stock price increases, he )ill Hust
let the put contract e.pire )orthless and onl$ lose his pre!iu! paid.
Short Put
Da$o**s and pro*its *ro! a naked short put.
+ trader )ho #elieves that a stock price )ill increase can #u$ the stock
or instead sell a put. -he trader sellin a put has an o#liation to #u$ the
stock *ro! the put #u$er at the put #u$erMs option. I* the stock price
increases, the short put position )ill !ake a pro*it in the a!ount o* the
pre!iu!. I* the stock price decreases #elo) the e.ercise price #$ !ore
than the a!ount o* the pre!iu!, the trader )ill lose !one$, )ith the
potential loss #ein up to the *ull value o* the stock.
!ptions as Hedging %ool
E16 Iedin5 Short Stock Bon 2all
1"
Gnlike an investor )ith a lin position in stock, a short seller o* stock
anticipates a decline in stock prices. B$ shortin the stock no) and
#u$in it at a later date at a lo)er price in the *uture, the investor intends
to !ake a pro*it. +n$ price increase can #rin losses #ecause o* an
o#liation to purchase at a later date. -o !ini!i/e the risk involved, the
investor can #u$ a call option )ith an e.ercise price e9ual to or close to
the sellin price o* the stock.
#n example
Bet us take a h$pothetical case o* an investor )ho shorts a share at Rs.
111 and #u$s a call option *or Rs. 4 )ith a strike price o* Rs. 115. -he
conditional pa$o**s resultin *ro! so!e selected prices o* the share are
sho)n in the ne.t ta#le.
Share
Price
E#ercise
Price
Proit on
e#ercise &i'
Proit1 loss
on share
held &ii'
Net Proit
&i' 2 &ii'
'1 115 %4 15 11
'5 115 %4 11 "
111 115 %4 5 1
115 115 %4 1 %4
111 115 1 %5 %4
115 115 " %11 %4
121 115 11 %15 %4
PRA!TI!A3 EXA/P3E,0
On 5
th
March, 211F
One share o* I2I2I Bank )as sold at Rs.'"1.41
2all option o* :.ercise Drice Rs. ''1 )as #ouht N Rs.42.31
On 2@
th
March, 211F Spot Drice )as Rs.F34.55
Share
Price
E#ercise
Price
Proit on
e#ercise &i'
Proit1 loss on
share held &ii'
Net Proit
&i' 2 &ii'
F34.55 ''1 E42.316 125.F5
E'"1.41%F34.556
F3.55
E26 Iedin5 Bon Stock Bon Dut
Iedin represents a strate$ #$ )hich an atte!pt is !ade to li!it the
losses in one position #$ si!ultaneousl$ takin a second o**settin
1@
position. -$picall$, a hede strate$ strives to prevent lare losses
)ithout sini*icantl$ reducin the ains.
;er$ o*ten, options in e9uities are e!plo$ed to hede a lon or short
position in the underl$in co!!on stock. Such options are called
covered options in contrast to the uncovered or naked options, discussed
earlier. -his strate$ vi/. Bon Stock Bon Dut involves #u$in a stock
and si!ultaneousl$ #u$in a Dut Option.
#n example
2onsider an investor )ho #u$s a share *or Rs 111. -o uard aainst the
risk o* loss *ro! a *all in its price, he #u$s a put *or Rs 1" *or an
e.ercise price o*, sa$, Rs 111. Ie )ould, o#viousl$ e.ercise the option
onl$ i* the price o* the share )ere to #e less than Rs. 111. -he *ollo)in
ta#le ives the pro*itC loss *or so!e selected values o* the share price on
!aturit$ o* the option.
Share
Price
E#ercise
Price
Proit on
e#ercise &i'
Proit1 loss
on share
held &ii'
Net Proit
&i' 2 &ii'
@1 111 24 %31 %"
F1 111 14 %21 %"
'1 111 4 %11 %"
111 111 %" 1 %"
111 111 %1" 11 %"
121 111 %1" 21 4
131 111 %1" 31 14
141 111 %1" 41 24

For instance, at a share price o* Rs. F1, the put )ill #e e.ercised and the
resultin pro*it )ould #e Rs. 14, e9ual to Rs. 111 O Rs. F1, or Rs. 31
minus the put pre!iu! o* Rs. 1". &ith a loss o* Rs. 21 incurred *or the
reason o* holdin the share, the net loss e9uals to Rs. ".
-he pro*its resultin *ro! the strate$ o* holdin a lon position in the
stock and lon put are sho)n in the *ollo)in *iure. In all the *iures
that *ollo) no), the dashed lines depict the relationship #et)een the
pro*it and stock prices *or the stock in 9uestion, on the one hand, and
pro*it and the option on the other hand. -he solid line in each case
depicts the relationship #et)een pro*it and stock prices or the $hole
%ortolio. It !a$ *urther #e noted that the pro*itC loss sho)n is on a per
share #asis.
1F
PRA!TI!A3 EXA/P3E
On 5
th
March, 211F
One share o* I2I2I Bank )as #ouht at Rs.'"1.41
Dut option o* :.ercise Drice Rs. 1151 )as #ouht N Rs.115.25
On 2@
th
March, 211F Spot Drice )as Rs.F34.55
Share Price E#ercise
Price
Proit on
e#ercise &i'
Proit1 loss on
share held &ii'
Net Proit
&i' 2 &ii'
F34.55 1151 111.21
E1151%F34.55%
115.256
E125.F56
EF34.55%'"1.416
E15."56
E36 Iedin5 Bon Stock Short 2all
In the previous t)o strateies, the investor takes Long positions in the
Option% #e it 2all or Dut. Iedin can also #e undertaken #$ )ritin
Etaking a Short position) 2all as )ell as Dut Options in appropriate
circu!stances.
One o* such strateies is to write a covered call option )hen the investor
has alread$ taken a lon position in the underl$in individual stock. I*
the co!!on stock is not e.pected to )itness a sini*icant chane, either
)a$, in the near *uture, then the strateies o* )ritin calls and puts !a$
#e use*ull$ e!plo$ed to !ini!i/e the risk. -he *ollo)in pararaph
sho)s%Io)P
+n e.a!ple
I* an investor has #ouht a share *or Rs. 111, he can e!plo$ this
strate$ #$ )ritin a call option )ith the strike price o*, sa$ Rs. 115,
)ith the pre!iu! o* Rs. 3. -he pro*itC loss occurrin at so!e prices o*
the underl$in share, is indicated in the *ollo)in ta#le.
Shar !r"# E$r#"% !r"# !r&'"( &)
$r#"% *"+
!r&'"(/ ,&%% &)
%har h,- *""+
N( !r&'"(
*"+ . *""+
)$ #$* % "#$ "+
)* #$* % "* "2
#$$ #$* % $ %
#$* #$* % * ,
##$ #$* "2 #$ ,
##* #$* "+ #* ,
#2$ #$* "#2 2$ ,
PRA!TI!A3 EXA/P3E,0
1'
On 5
th
March, 211F
One share o* Reliance Industries ltd. )as #ouht at Rs.22'2.@5
+ call option o* :.ercise Drice Rs.2311 )as )ritten N Rs.111.15
On 2@
th
March, 211F Spot Drice )as 22@5
Share Price E#ercise
Price
Proit on
e#ercise &i'
Proit1 loss on
share held &ii'
Net Proit
&i' 2 &ii'
22@5 2311 111.15 E1@.@56
E22@5%22'2.@56
F3.3
E46 Iedin5 Short Stock Short Dut
:.actl$ adverse strate$ is to #e adopted )hen the investor short sells
the share. Ie can hede #$ )ritin a Dut Option. -hus, #$ undertakin
Qto #e a #u$er<, the investor hopes to reduce the !anitude o* loss that
)ould #e *ro! an increase in the stock price, #$ li!itin the pro*it that
could #e !ade )hen the stock price declines.
+n e.a!ple
Suppose, an investor shorts a share at Rs. 111 and )rite a put option *or
Rs.3, havin an e.ercise price o* Rs. 111. 2learl$, the #u$er o* the put
)ill e.ercise the option onl$ i* the share price does not e.ceed the
e.ercise price. -he ta#le ivin conditional pa$o** is iven #elo)5
Share
Price
E#ercise
Price
Proit on
e#ercise &i'
Proit1 loss on
share held &ii'
Net Proit &i' 2
&ii'
'1 111 %@ 11 3
'5 111 %2 5 3
111 111 3 1 3
115 111 3 %5 %2
111 111 3 %11 %@
115 111 3 %15 %12
121 111 3 %21 %1@
DR+2-I2+B :?+MDB:5%
On 5
th
March, 211F
One share o* Reliance Industries )as sold at Rs.22'2.@5
Dut option o* :.ercise Drice Rs.2221 )as )ritten N [email protected]
On 2@
th
March, 211F Spot Drice )as Rs.22@5
Share Price E#ercise
Price
Proit on
e#ercise &i'
Proit1 loss on
share held &ii'
Net Proit
&i' 2 &ii'
22@5 2221 @2.41 E556 [email protected]
21
E2221%22@56
!ption Strategies
-here are the various strateies a#out derivatives that li!it $our losses.
In derivatives tradin the a!ount e.posed is ver$ hih hence it is
advisa#le *or $ou to have the kno)lede o* such strateies o*
derivatives.
-here are #asicall$ t)o t$pes o* strateies in derivatives5
E16 Spread Strateies
E26 2o!#ination Strateies
Spread Strategies
Spread strateies involve dealin in onl$ one t$pe o* option i.e. call
option or put options. Spread !eans the di**erent #et)een the t)o strike
prices o* the scrip o* the sa!e e.pir$ period.
For e.a!ple, Sat$a! call options )ith strike price Rs. 221 and Rs. 231
o* +uust, in this case the spread id o* Rs. 11. -here are various spread
strateies that )e )ill see in the latter stae o* this content.
-he e.a!ples o* spread strateies are as *ollo)s
E16 Bull Spread strateies )ith call and put options
E26 Bear Spread strateies )ith call and put options
E36 Butter*l$ Spread strateies
)ombination Strategies
Spread Strateies involve either call or put option #ut co!#ination
strateies involve tradin o* dealin )ith call and put option
si!ultaneousl$. -here are various t$pes o* co!#ination strateies.
-he e.a!ples o* co!#ination strateies are as *ollo)s5
E16 Straddle Strate$
E26 Strip strate$
E36 Strap Strate$
,ull Spread (sing )alls
Spread tradin strate$ involves takin a position in t)o or !ore
options o* the sa!e t$pe.
21
-his strate$ vi/. Bull Spread is undertaken )hen one is #ullish a#out
the *uture price !ove!ents in the stock prices. Io)ever, Bull Spread
can #e a**ected usin 2alls as )ell as Duts. -he latter is e.plained in the
ne.t head o* strate$.
-his strate$ calls *or #u$in a 2all Option on a stock and )ritin the
2all Option on the sa!e stock )ith the sa!e !aturit$ date, #ut )ith a
hiher e.ercise price. In case o* 2all Options, pre!iu! on the Option
)ith lo)er e.ercise price is reater than that on Option )ith hiher
e.ercise price.

So, in a )a$, this strate$ involves so!e initial cost as the pre!iu!
receiva#le *or )ritin a 2all Option E)ith a hiher e.ercise price6 )ould
#e less than the pre!iu! pa$a#le on the 2all Option #ouht E)ith a
lo)er e.ercise price6.
I* on the e.pir$, the stock price is less than the lo)er e.ercise price,
#oth the 2all Options )ould #e Out%o*%!one$ and, hence, #oth )ould
e.pire une.ercised. In that case, net out*lo) )ould #e initial cost as
represented #$ the di**erence #et)een the pre!iu! pa$a#le E)hich is
hiher6 and pre!iu! receiva#le.
I* the last possi#ilit$ i.e. the stock price #ein reater than the hiher
e.ercise price, happens, then, #oth the 2all Options, #ein in the !one$,
)ould #e e.ercised. -he resultant net pro*it )ould #e the di**erence
#et)een the t)o e.ercise prices as reduced #$ the initial spread cost, as
represented #$ the di**erence #et)een the pre!iu! pa$a#le and the
pre!iu! receiva#le.
-he pa$o** ta#le *or the Bull Spread EGsin 2alls6 is as sho)n #elo)5
PR#)%$)#* E-#.P*E:
On 5
th
March, 211F O(R2 2all option o* :.ercise Drice Rs.'F1 )as
#ouht N Rs.3F. O(R2 2all option o* :.ercise Drice Rs.1111 )as
)ritten N Rs.3".55.
Price o Stoc" Pa(o rom 3ong
!all
Pa(o rom Short
!all
Total Pa(o
S
1
SL :
2
S
1
O :
1
:
2
O S
1
:
2
O :
1
:
1
T S
1
T :
2
S
1
O :
1
O E(ot :.ercised6 S
1
O :
1
S
1
TL :
1
O E(ot :.ercised6 O E(ot :.ercised6 1
22
On 2@
th
March, 211F Spot Drice )as [email protected]
Share Price Proit on call
4ought
Proit on call
$ritten
Proit13oss on
Premium
Net Proit
[email protected] '1.15
[email protected]%'F16
[email protected]
E1111%
[email protected]
E1.456
E3".55%3F6
1F.55
,ull Spread (sing Puts
In this strate$, the investor purchases a Dut Option on the underl$in
and )rites a Dut Option on the sa!e underl$in and )ith the sa!e
e.pir$ date, #ut )ith a hiher e.ercise price. Iere also, there )ould #e a
di**erence #et)een the pre!iu!s pa$a#le and pre!iu! receiva#le. -he
pre!iu! pa$a#le on the #ouht Dut Option E)ith a lo)er e.ercise price6
)ould #e less as co!pared to the pre!iu! receiva#le on the sold Dut
Option E)ith a hiher e.ercise price6.
(o), suppose, on the e.pir$, the price o* the underl$in is less than the
lo)er e.ercise price, then #oth the Dut Options )ould #e e.ercised. -he
net result )ould #e the di**erence #et)een pre!iu! received and
pre!iu! paid minus the loss on e.ercise prices o* the t)o options Eas
represented #$ the di**erence #et)een the t)o e.ercise prices6.
I*, on the e.pir$, the price o* the underl$in is #et)een the t)o e.ercise
prices, then the Dut Option )ith hiher e.ercise price E)hich )as sold
#$ the investor6 )ould #e e.ercised and other Dut Option )ould e.pire
une.ercised. -he net pa$o** )ould #e the di**erence #et)een the
pre!iu!s o* #oth the options as reduced 4( the di**erence #et)een the
e.ercise price o* the Dut Option sold and the price o* the underl$in.
-he third possi#ilit$, that is to sa$, the price o* the underl$in #ein
reater than the hiher e.ercise price, happens, then #oth the options
)ould e.pire une.ercised, #ein out%o*%!one$. In that case, our investor
)ould end up earnin the di**erence #et)een the pre!iu! received on
the )ritten Dut and the pre!iu! paid on the #ouht Dut.
PR#)%$)#* E-#.P*E:
On 5
th
March, 211F
S+IB Dut option o* :.ercise Drice Rs.221 )as #ouht N Rs.'.'1
S+IB Dut option o* :.ercise Drice Rs.231 )as )ritten N Rs.14.'1
On 2@
th
March, 211F Spot Drice )as Rs.211.11
23
Share Price Proit on %ut
4ought
Proit on %ut
$ritten
Proit13oss on
Premium
Net Proit
211.11 1'.'1
E221%211.116
E2'.'16
E211.11%2316
5
E14.'1%'.'16
E56
,ear call spread
+ #ear call spread is constructed #$ #u$in call options o* a certain
strike price and sellin the sa!e nu!#er o* call options o* lo)er strike
price Ein the !one$6 on the sa!e underl$in )ith the sa!e e.piration
!onth.
Example
2onsider an ar#itrar$ stock 9uotin at Rs.111 Elot si/e L 1116 in this
!onth. -he call option *or this !onth *or strike price o* Rs.115 is at
Rs.2 and the call option *or this !onth *or Rs.'5 is tradin at Rs.@.
-he trader can #u$ the Rs.115 call option Eout*lo) o* Rs.2116 and sell
the Rs.'5 call option Ein*lo) o* Rs.@116. -he total in*lo) )ill #e
Rs.511. -he trader )ill #e pro*ita#le )hen the stock ends #elo) 111.
-he !a. loss is 115%'5%5L5 per share Ei* the share price ends at or
a#ove 1156, !a. pro*it is 5 per share. &hen the share price ends at or
#elo) '5.
PR#)%$)#* E-#.P*E
On 5
th
March, 211F
IF2I 2all option o* :.ercise Drice Rs."1 )as #ouht N Rs.3.'1
IF2I 2all option o* :.ercise Drice Rs.55 )as )ritten N Rs.".31
On 2@
th
March, 211F Spot Drice )as Rs.41.'1
Share Price Proit on call
4ought
Proit on call
$ritten
Proit13oss on
Premium
Net Proit
41.'1 (IB
Eune.ercised6
(IB
Eune.ercised6
2.41
E".31%3.'16
2.41
,ear put spread
+ #ear put spread is constructed #$ #u$in hiher strikin in%the%!one$
put options and sellin the sa!e nu!#er o* lo)er strikin out%o*%the%
!one$ put options on the sa!e underl$in securit$ and the sa!e
e.piration !onth.
24
-he options trader hopes that the price o* the underl$in drops,
!a.i!i/in his pro*it )hen the underl$in drops #elo) the strike price
o* the )ritten option, nettin hi! the di**erence #et)een the strike
prices !inus the cost o* enterin into the position.
PR#)%$)#* E-#.P*E:
On 5
th
March, 211F
IF2I Dut option o* :.ercise Drice Rs."1 )as #ouht N Rs.".11
IF2I Dut option o* :.ercise Drice Rs.51 )as )ritten N Rs.2.15
On 2@
th
March, 211F Spot Drice )as Rs.41.'1
Share Price Proit on
%ut 4ought
Proit on %ut
$ritten
Proit13oss on
Premium
Net Proit
41.'1 1F.11
E"1%41.'16
EF.116
E41.'1%516
E4.156
E2.15%".116
5.'5
Straddle
+ Straddle is a strate$ )here $ou #u$ a 2all Option as )ell as a Dut
Option on the sa!e underl$in scrip Eor inde.6 *or the sa!e e.pir$ date
*or the sa!e strike price. For e.a!ple, i* $ou #u$ a Sat$a! 0ul$ 2all
Strike Drice 241 and also #u$ a Sat$a! 0ul$ Dut Strike Drice 241, $ou
have #ouht a Straddle.
+s a #u$er o* #oth 2all and Dut, $ou )ill pa$ a Dre!iu! on #oth the
transactions. I* the 2all costs Rs 12 and the Dut Rs ', $our total cost )ill
#e Rs 21.
"hen will $ buy a Straddle/
>ou )ill #u$ a Straddle i* $ou #elieve that Sat$a! )ill #eco!e volatile.
Its current price is sa$ Rs 241, #ut $ou think it )ill either rise or *all
sini*icantl$. For e.a!ple, $ou could #elieve that Sat$a! could rise
riht upto Rs 311 or *all upto Rs 211 in the ne.t *ortniht or so.
"hy should it fluctuate so much/
-here could #e various situations, )hich !iht )arrant heav$
!ove!ent. For e.a!ple, durin Budet ti!e, a *avora#le proposal
!iht i!pact the price *avora#l$ and i* nothin *avora#le is proposed,
the price could *all sini*icantl$. +n Indian co!pan$ could #e
considerin colla#orations )ith a !aHor *orein co!pan$. I* the
25
colla#oration )ere to happen, the price could rise, and i* it )ere not to
happen, the price could *all.
+n Indian co!pan$ !iht #e e.pectin a hue order *ro! a *orein
co!pan$. -he !arket !iht #e a)aitin ne)s on this *ront. &hile a
positive develop!ent !iht result in a price rise, a neative
develop!ent !iht da!pen the prices.
So!e co!panies !iht *ace hue la)suits. -he decision could
sini*icantl$ i!pact prices an$ )hich direction.
"hat are the other implications of Straddle/
+s a #u$er o* the Straddle, $ou )ill pa$ initiall$ *or #oth the 2all and
the Dut. >ou need not place an$ !arins as $ou are a #u$er o* #oth
Options. I* ti!e passes and the scrip re!ains at or around the sa!e price
Ein this case Rs 2416, $ou )ill *ind that the Option Dre!ia o* #oth the
2all and the Dut )ill decline E-i!e ;alue o* Options decline )ith
passae o* ti!e6. Ience, $ou )ill su**er losses.
"hen will $ sell a Straddle/
>ou #ouht a Straddle #ecause $ou thouht the scrip )ill #eco!e
volatile. 2onversel$, the seller o* the Straddle )ould #elieve that the
scrip )ill act neutral. -he seller )ill #elieve that the price o* Sat$a!
)ill sta$ around Rs 241 in the ne.t *ortniht or so. +ccordinl$, he )ill
sell #oth the 2all and the Dut.
I* the price indeed re!ains around Rs 241, he )ill !ake a !a.i!u!
ain o* Rs 21. I* the price )ere to !ove up or do)n, he )ill !ake a
lo)er ain as he )ill have to pa$ either on the 2all Ei* it !oves up6 or on
the Dut Ei* it !oves do)n6.
"hat is the breakeven point of the Straddle/
-he Straddle has t)o #reak%even points vi/. the Strike Drice plus #oth
Dre!ia and the Strike Drice !inus #oth Dre!ia. In the a#ove e.a!ple,
the t)o #reak%even points are Rs 2"1 E241 K 216 and Rs 21' E241 O 216.
+s seen earlier, the #reak%even points are the sa!e *or the #u$er and the
seller.
"hat are the other implications for the seller/
2"
+s a seller, he )ill receive the Dre!ia o* Rs 21 on da$ one. Ie )ill have
to place !arins on #oth the Options and hence these re9uire!ents
could #e *airl$ hih. I* ti!e passes and the scrip sta$s around Rs 241,
the seller )ill #e happ$ as the Option values )ill decline and he can #u$
#ack these Options at a lo)er level. On the other hand, i* the scrip
!oves, he should #e care*ul and think o* closin out earl$.
PR#)%$)#* E-#.P*E:
On 5
th
March, 211F I2I2I Bank 2all option o* :.ercise Drice Rs.1151
)as #ouht N Rs.22.45
I2I2I Bank Dut option o* :.ercise Drice Rs.1151 )as #ouht N
Rs.115.25
On 2@
th
March, 211F Spot Drice )as Rs.F34.55
Share
Price
Proit on call Proit on %ut Proit13oss on
Premium
Net Proit
F34.55 (IB
Eune.ercised6
215.45
E1151%F34.556
E12@.@6
E22.45K115.256
F@.@5
Strangle
+ Stranle is a slihtl$ sa*er Strate$ in the sense that $ou #u$ a 2all
and a Dut #ut at di**erent strike prices rather than one sinle strike price
as in the case o* a Straddle. For e.a!ple, $ou could #u$ a Sat$a! Dut
Strike 221 and a Sat$a! 2all Strike 2"1 at prices o* Rs 5 and Rs "
respectivel$. -his )ould cost $ou Rs 11 and $ou )ould have a ;olatile
vie) on the scrip.
-he lo)er cost )ould ho)ever i!pl$ a )ider #reak even and $ou )ould
!ake pro*it onl$ i* the Scrip !oves up or do)n #$ a )ider !arin.
-he pro*it potential is provided in this ta#le5
Sat(am !losing
Price
Proit on !all Proit on Put Initial !ost Net Proit
211 1 21 11 '
211 1 11 11 %1
221 1 1 11 %11
231 1 1 11 %11
241 1 1 11 %11
251 1 1 11 %11
2"1 1 1 11 %11
2@1 11 1 11 %1
2@
2F1 21 1 11 '
-he t)o #reak%even points here )ould #e )orked out as lo)er strike !inus
the t)o pre!iu!s and hiher strike plus the t)o pre!iu! respectivel$. In this
case, the #reak%even points are Rs 21' E221 O 116 and Rs 2@1 E2"1 K 116.
PR#)%$)#* E-#.P*E:
On 5
th
March, 211F Ran#a.$ 2all option o* :.ercise Drice Rs.4@1 )as
#ouht N Rs.11.1'
Ran#a.$ Dut option o* :.ercise Drice Rs.451 )as #ouht N Rs.1'
On 2@
th
March, 211F Spot Drice )as Rs.435."5
Share
Price
Proit on call Proit on %ut Proit13oss on
Premium
Net Proit
435."5 (IB
Eune.ercised6
14.35
E451%435."56
E31.1'6
E1'K11.1'6
E15.F46
,utterfly
I* $ou are a seller, $ou are e.posed to unli!ited losses in #oth straddles
and stranles. -his pro*ile !a$ !ake $ou unco!*orta#le and $ou !iht
like to reduce or li!it $our loss possi#ilities.
-he #utter*l$ strate$ helps $ou to achieve this result. >ou )ould in this
case, cut the )ins o* $our straddle. -o cut the )ins, $ou )ould #u$ a
2all )ith a hiher strike price and #u$ another put )ith a lo)er strike
price than that o* the Straddle.
Example:
>ou have sold a Straddle on Sat$a! )ith Strike Drice 241 and enerated
an Inco!e o* Rs 24 Eas a#ove6. >ou could #u$ a 2"1 Strike 2all *or Rs 5
and #u$ a 221 Strike Dut *or Rs ". -his )ould cost $ou Rs 11, thus
reducin $our (et Inco!e to Rs 13. It )ill ho)ever insure $ou *ro!
losses at #oth ends.
-he *inal pa$o** ta#le )ill e!ere as under5
Sat(am
!losing
Price
Proit on
567 !all
Sold
Proit on 587
!all -ought
Proit on 557
Put -ought
Proit on
567 Put Sold
Net Proit
Including
Initial Income
o Rs 9:
211 1 1 21 %41 %@
2F
211 1 1 11 %31 %@
221 1 1 1 %21 %@
231 1 1 1 %11 3
241 1 1 1 1 13
251 %11 1 1 1 3
2"1 %21 1 1 1 %@
2@1 %31 11 1 1 %@
2F1 %41 21 1 1 %@
-hus, $ou )ill enerate a !a.i!u! pro*it o* Rs 13 i* Sat$a! re!ains at
$our Straddle Strike price o* Rs 241. >our !a.i!u! loss is restricted to
Rs @, )hich happens )hen Sat$a! !oves either #elo) Rs 221, or a#ove
Rs 2"1. -his loss is capped on #oth sides.
,lack0Scholes
-he ter! -lac";Scholes re*ers to three closel$ related concepts5
-he -lac";Scholes model is a !athe!atical !odel o* the !arket *or
an e9uit$, in )hich the e9uit$Ms price is a stochastic process.
-he -lac";Scholes PDE is a partial di**erential e9uation )hich Ein
the !odel6 !ust #e satis*ied #$ the price o* a derivative on the e9uit$.
-he -lac";Scholes ormula is the result o#tained #$ solvin the
Black%Scholes DD: *or :uropean put and call options.
Ro#ert 2. Merton )as the *irst to pu#lish a paper e.pandin our
!athe!atical understandin o* the options pricin !odel and coined the
ter! UBlack%ScholesU options pricin !odel, #$ enhancin )ork that
)as pu#lished #$ Fischer Black and M$ron Scholes.
%he model
-he ke$ assu!ptions o* the BlackOScholes !odel are5
2'
-he price o* the underl$in instru!ent S
t
*ollo)s a eo!etric
Bro)nian !otion )ith constant dri*t V and volatilit$ W5
ds
t
L Xs
t
dt K Ws
t
d)
t
It is possi#le to short sell the underl$in stock.
-here are no ar#itrae opportunities.
-radin in the stock is continuous.
-here are no transaction costs or ta.es.
+ll securities are per*ectl$ divisi#le Ee.g. it is possi#le to #u$ an$
*raction o* a share6.
It is possi#le to #orro) and lend cash at a constant risk%*ree interest
rate.
-he a#ove lead to the *ollo)in *or!ula *or the price C o* a :uropean
call option )ith e.ercise price K on a stock currentl$ tradin at price S,
i.e., the riht to #u$ a share o* the stock at price K a*ter T $ears. -he
constant interest rate is r, and the constant stock volatilit$ is W.
2ES,-6LSYEd
1
6% Z e
Or-
Y Ed
2
6
&here d
1
L ln EsCk6 K ErKW
2
C26 -
W [-
d
2
L ln E s Ck 6 K E r %W
2
C26 -
W [-
Ld
1
% W [-
Iere \ is the standard nor!al cu!ulative distri#ution *unction.
Interpretation5 \Ed
1
6 and \Ed
2
6 are the pro#a#ilities o* e.ercise under the
e9uivalent e.ponential !artinale pro#a#ilit$ !easure Enu!eraire L
stock6 and the e9uivalent !artinale pro#a#ilit$ !easure Enu!eraire L
risk *ree asset6, respectivel$.
31
)INAN!IA3
RIS<
/ANA=E/ENT
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Financial Risk .anagement
Four Steps in Risk .anagement
1. Gnderstand the nature o* various risks.
2. De*ine a risk !anae!ent polic$ *or the orani/ation and
9uanti*$in !a.i!u! risk that orani/ation is )illin to take i*
9uanti*ia#le.
3. Measure the risks i* 9uanti*ia#le and enu!erate other)ise.
4. Build internal control !echanis! to control and !onitor all the risks.
Step 1 (nderstand Risks
Risks can #e classi*ied into three cateories.
Price or /ar"et Ris"
!ounter%art( or !redit Ris"
*%erating Ris"s ,
Step 2 'efine Risk Policy
Decide the #asic risk polic$ that the orani/ation )ants to have.
)ost )enter 3s+ Profit )enter
+ cost centre approach looks at e.posure !anae!ent as insurance
aainst adverse !ove!ents. One is not lookin *or opti!i/ation o* cost
or reali/ation #ut !eetin certain #udeted or tareted rates. In a pro*it
centre approach, the #usiness is takin deli#erate risks to !ake !one$
out o* price !ove!ents.
Step 4 Risk .easurement
-here are a nu!#er o* di**erent !easures o* price or !arket risk )hich
are !ainl$ #ased on historical and current !arket values :.a!ples are
;alue at Risk E;+R6, Revaluation, Modellin, Si!ulation, Stress
-estin, Back -estin, etc.
Step 5 Risk )ontrol
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2ontrol o* Drice Risk
2ontrol o* 2redit Risk
2ontrol o* Operatin Risk
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+pte, D. R.E21126 International Financial Management,
-ata McRra) Iill
Basis o* Derivatives 5 the stock e.chane o* Mu!#ai, India
in*oline
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