marketing questions

[rookie1978]

can someone explain hedging, calls and puts to me or a possible site that would help



thanks

 

[okmike]

Hedging is a term used to describe actions that you take in a market to minimize risk. if you are in a high risk market, you may put some money in a low risk market to "hedge" or balance out the average amount of risk that you have. Puts and Calls are used as options to sell and buy any product or stock that is in the option, it can be stocks or bonds or even corn. Say if you buy a put option on a stock, the stock price drops below the what they call the strike price which is what is specified when you buy the put, you can exercise this put which gives you the right to sell. with stock price being lower than the strike, you buy in the market at market price and "sell" at the strike price thereby clearing a profit. Now, if you buy a call option it works similar but the opposite. You buy a call that has a specified strike price, the stock price goes through the roof, you exercise your call and buy stock at the strike price and turn around and sell them in the market at current market price which is way higher than strike and now again you've cleared a profit.

 

[Ryder]

http://www.cboe.com

http://www.tfc-charts.w2d.com
click on short course

 

[dcara]

Here's a link to relavent articles out of OSU. See articles F-430 thru F-433.
Sometimes they move the article library and you have to do a search for them by entering the article number as a search papramter.


http://pearl.agcomm.okstate.edu/agecon/ ... index.html