Demonstrate how VIX futures work

Assignment Help Finance Basics
Reference no: EM132183863

Question - Cboe Volatility Index (commonly referred to as VIX) is a measure of volatility published by Chicago Board Options Exchange. It is also commonly known as the fear index, as it measures how volatile the stock price movements are. When times are good and stable, its values are low. But when the market experiences swings, VIX value increases.
A number of derivatives, such as &P 500 VIX Short-Term Futures, were developed, and they are designed to profit on either low or high VIX values.

Investors can supplement their stock portfolio with VIX future and receive reimbursements, if the volatility increases. On the other hand, they can also take the opposite position and profit from stability on the market.

1) Demonstrate how VIX futures work.

2) Critically evaluate how risk can be hedged using VIX futures and, on the other hand, what risks such a strategy can bring.

3) Analyse the reasons why VIX derivative investments are often a target of a public criticism.

Reference no: EM132183863

What is p the stock price afte the recap

mary had no short term investment s before or after the recap after the recap Wd=1/3. the firm has 28 million shares before the recap. what is P the stock price afte the rec

Describe purpose and function of national response center

Explain the purpose and function of the National Response Center. Your response must be at least 150 words in length. You are required to use at least your textbook as sourc

What was last year’s dividend per share

One week after Granddad's Kitchen split its stock 3-for-1, it paid a dividend of $0.55 per new share. The dividend payment was 10 percent greater than last year's presplit d

What is the amortization schedule of these sixty payments

Moulton Motors is advertising the following deal on a new Honda Civic: “Monthly Payments of $400.40 for the next 60 months and this beauty can be yours!” The sticker price of

How much will she have in the account after the 10 years

Jacquie plans to deposit $3,500 into her savings account for each of the next 5 years, and then $2,000 per year for 5 years after that (all at year end). She anticipates i

Write an initial proposal for this funding

Operations really need a study to see why there is variability, how much is acceptable, what its effects are, how it can be reduced, what benefits this will bring and so on.

Describe the basic form of the entries recorded by kyocera

Explain why these amounts appear on the statement of cash flows, and why depreciation and amortization and the loss on impairment of PP&E and intangibles are positive number

Find two articles that discuss financial ratio analysis

Using the Ashford University Library as a resource, find two articles that discuss financial ratio analysis. Identify two advantages and two disadvantages to using ratios in


Write a Review

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd