A Mental Framework Concerning a Sequence of Events That Usually

question 453

Multiple Choice

A mental framework concerning a sequence of events that usually unfolds in a regular, almost standardized order is called a ________.

• A)script
• B)schema
• C)principle
• D)concept

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Definitions:

Call Delta

A measure of the sensitivity of an option's price to a change in the price of the underlying asset.

Volatility Risk

The risk in the value of options portfolios due to unpredictable changes in the volatility of the underlying asset.

Hedge Ratio

A ratio used to measure the proportion of a position that is hedged or the amount of assets used to hedge a risk exposure.

Dynamic Hedging

Constant updating of hedge positions as market conditions change.