| American Style Option |
the option may be exercised at any time before maturity. |
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| At-the-money Option |
the strike price is equal to the spot price of the underlying instrument. |
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| Basket Certificate |
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| Basket Option |
an option that has a payoff dependent on the total value of a predifined portfolio. |
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| Benchmark |
reference index to measure the performance. |
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| Beta |
measure of systematic risk of an asset. |
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| Bid-Ask Spread |
difference between bid price and ask price. |
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| Calculation Agent |
the entity which is responsible for the calculation of all the prices. |
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| Call Option |
the holder of an option owns the right, but not the obligation, to buy the underlying instrument at the strike price. |
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| Cash Settlement |
procedure for settling contracts in cash rather than delivering the underlying instrument. |
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| Counterparty |
the opposite side in a financial transaction. |
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| Coupon |
the interest payment made on a bond or a yield certificate. |
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| Delta |
the rate of change of the price of a derivative with the price of the underlying instrument. |
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| Derivative |
instrument whose price depends on the price of an underlying instrument. |
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| Discount Certificate |
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| Dividend |
cash payment made to the owner of a stock. |
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| Dividend Yield |
dividend calculated as a percentage of the underlying price. |
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| European Style Option |
the option may be exercised only at expiration. |
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| Exercise Price (Strike price) |
the price at which the underlying may be bought or sold in an option contract. |
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| Exotic Option |
nonstandard option. |
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| Expiration Date |
the end of life of a contract. |
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| Final Valuation Date |
day on which the redemption price of a certificate is fixed. |
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| Gamma |
rate of change of delta with respect to the instrument price. |
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| Gearing |
spot price of the underlying security divided by the price of the option. |
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| In-the-money Option |
either a call option where the underlying price is greater than the strike price or a put option where the underlying price is less than the strike price. |
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| Index Certificate |
a certificate based on an index. The price development of the index certificate reflects the performance of the underlying index. An investor acquires a diversified portfolio in a specific market. |
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| Initial Fixing Date |
day on which the issue price of a certificate is fixed. |
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| Intrinsic Value |
for a call option, it is the greater of the excess of the underlying price over the strike price and zero. For a put option, it is the greater of the excess of the strike price over the underlying price and zero. |
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| Issue Date |
date on which the product is launched. |
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| Issue Size |
total number of instruments issued by the bank. |
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| Issuer |
entity which issues instruments. |
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| Listing |
registration of an instrument on an official exchange. |
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| Market Maker |
institution who is required to quote bid and offer prices for an instrument at the same time. |
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| Maturity Date |
the end of life of a contract. |
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| Option |
the right to buy (call) or sell (put) an instrument. |
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| Out-of-the Money Option |
either a call option where the underlying price is less than the strike price or a put option where the underlying price is greater than the strike price. |
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| Over-the-counter Market (OTC) |
market where traders deal by phone. Trades with special conditions that cannot be traded on the official exchange. |
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| Participation |
percentage at which the invested amount participates in the performance of the underlying security. |
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| Payment Date |
settlement date of the certificates. |
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| Payoff |
performance realized by the holder of an option at the end of its lifetime. |
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| Physical Delivery |
redemption in the form of physical delivery of the underlying instrument. |
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| Plain Vanilla Option |
standard option. |
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| Premium |
percentage indicating how much more expensive the purchase or sale of an option is than the direct purchase or sale of the underlying instrument. |
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| Put Option |
the holder of an put option owns the right, but not the obligation, to sell the underlying instrument at the strike price. |
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| Rebalancing |
process of adjusting a trading position. |
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| Redemption Date |
the date on which an instrument is due to be repaid by its issuer at its redemption price. |
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| Redemption Price |
the price at which an instrument is repaid. |
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| Rho |
the rate of change of the price of a derivative with the interest rate change. |
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| Security Number / Valor |
identification number of an instrument. |
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| Strike Price |
the price at which the underlying can be bought or sold. |
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| Underlying |
instrument, stock, basket or index on which a derivative or a certificate is based. |
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| Volatility |
measure of the uncertainty of the return realized on an asset. |
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| Warrant |
option issued by a company or a financial institution. |
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| Withholding tax |
35% withholding tax, payable when the issuer has its domicile in Switzerland. |
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