| |

When Is a Put Option Considered to Be “In the Money”?

ByMario Cazombo

Fact checked by Pete RathburnReviewed by Thomas J. Catalano A put option is the opposite of a call option. The holder has the right but not the obligation to buy an underlying security at a specified strike price before it reaches its expiration date in the case of a call option. A put option gives the holder…

How Can Derivatives Be Used for Risk Management?
|

How Can Derivatives Be Used for Risk Management?

ByMario Cazombo

Reviewed by Gordon Scott ipuwadol/Getty Images Derivatives a major way investors and companies manage their risks. Derivatives are financial instruments whose value is derived from other assets like stocks, bonds, or foreign currencies. They are often used to hedge a position (protecting against the risk of a loss) or to speculate on future moves in…