Page 201 - DCOM510_FINANCIAL_DERIVATIVES

Financial Derivatives

Notes 5. Write down the features of risk containment mechanism on the F&O segment.
6. What are the objective of NSCCL-SPAN?
7. Explain the various types of margins.
8. What is margining system?

9. Explain the mechanics of SPAN.
10. Write short note in:
(a) Calendar Spread Margin
(b) Scanning Risk Charge

(c) Short Option Minimum Margin
(d) Net Buy Premium

Answers: Self Assessment

1. Financial derivatives 2. High-risk
3. True 4. True
5. True 6. True

7. False 8. Overall risk
9. Five 10. Risk array
11. Risk scenarios 12. Calendar spread

13. Last day 14. 10%
15. Case to case

12.8 Further Readings

Books Derivatives Market NCFM Module. National Stock Exchange India Limited
Publications: Bombay: 2007.

Gupta S.L. (2007). Financial Derivatives Prentice Hall. New Delhi.
Jaynath Rama Varma (2008). Derivatives and Risk Management. Tata McGraw
Hill Publications: New Delhi.

2008. Indian Stock Market Review. National Stock Exchange Publications.

Online links http://derivativesindia.com
http://derivativesindia.com/scripts/glossary/index.aricles_e-articles

http://www.margrabe.com/Dictionary/derivatives/html
http://www.sebi.gov.in
http://www.nseindia.com/f&o

196 LOVELY PROFESSIONAL UNIVERSITY