Since the last financial crisis much has been said, both by the specialized and public press, on the nature of derivatives and their role in the latest global financial meltdown. Actually, their diffusion and broad usage is much older than commonly thought. The oldest known transaction, in terms of actual features similar to an option […]
Long before the Nobel Prize Committee acknowledged his insights into economics and trade, Paul Krugman made a hasty forecast about Information Technology: “As the rate of technological change in computing slows, the number of jobs for IT specialists will decelerate, then actually turn down; ten years from now, the phrase information economy will sound silly.” […]
The aim of this article is to explain the main idea behind the concept of volatility arbitrage by using Delta neutral portfolios composed by a combined position in a derivative instrument sensible to changes in (expected) volatility of the underlying, in our case an option contract, and in the underlying itself, in our case a […]
This article aims to understand the forex market better. We are going to deepen our knowledge looking at two of the most important characteristics for a professional portfolio manager: volatility and correlation. Through this article, we aim to clarify which currency, if any, could be useful in order to increase the diversification of our portfolio. Understanding […]
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