To create a delta-neutral portfolio, an investor who has written 15,000 call options (that are currently exactly at-the-money) will have to <u>balance positive and negative deltas.</u>
A portfolio strategy known as "delta neutral" employs numerous holdings with a balance of positive and negative deltas so that the total delta of the assets under consideration is zero.
A delta-neutral portfolio balances out the response to market fluctuations for a specific range, bringing the position's net change to zero. The term "delta" refers to the amount by which the price of the underlying security affects the price of an option.
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Essentially, an "invisible hand" would stabilize and help the economy by maintaining the equilibrium between supply and demand. It supports the idea of capitalism because that's the ideal way a free market would function. Hope this helped :-)
Answer:
Positive punishment is the introduction of a(n) aversive stimulus following a behavior and negative punishment is the withdrawal of a(n) pleasant stimulus following a behavior.
Explanation:
Positive punishment aims at reducing to the barest minimum the amount of wrong behavior exhibited by an individual and ensure it is not repeated. It is more effective when the act and the punishment are commensurate. For instance, when a child is destructive his/her parents may stop him/her from playing with toys or video games. Also, In a classroom, students who fail to do their assignments may be asked to kneel in front of the class for hours or given more assignments to do.
Negative Punishment, on the other hand, involves the removal of a wrong behavior by eradicating a stimulus. This type of punishment is more effective if it is consistently applied. For instance, a child who refuses to do his/her house chores may be barred from watching his/her favorite television show.
Answer:
Per capita gross domestic product (GDP) is a metric that breaks down a country's economic output per person and is calculated by dividing the GDP of a country by its population. Small, rich countries and more developed industrial countries tend to have the highest per capita GDP.
