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Dynamic Hedging

A hedging technique which is used to provide insurance for a portfolio of investments by limiting exposure to delta or...

Dirty Spark Spread

A spark spread that captures the gross margin reflecting the economics of a coal-fired power plant. More specifically, it refers...

Spot Start

An interest rate swap (or virtually any types of swaps) usually has a spot start date which means two business...

GDD

An abbreviation for growing degree days; a measure that is used in weather derivatives. By definition, it is the degrees...

Constant Maturity Floor

A constant maturity option (a floortion on a constant maturity swap) which gives the holder the right to place a...

All-In Effective Rate

Swap transactions are typically viewed as the exchange of a fixed rate for a floating rate, or vice versa. Interest...

LEAPS

It stands for long-term equity anticipation security; an American call or put option on securities or indexes. This kind of...

All-In Swap Rate

The effective swap rate which is paid or received by a swap's counterparty. This rate results from adding up the...

Constant Maturity Cap

A constant maturity option (a caption on a constant maturity swap) which gives the holder the right to place a...

Continuous Barrier Option

A barrier option in which in which the payoff is contingent on whether a specific level has been crossed or...