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Risk-Free Asset
An investment with a guaranteed return and no risk of default, often represented by government bonds from stable governments.
Strike Price
The predetermined price at which the holder of an option can buy (in the case of a call option) or sell (in the case of a put option) the underlying security or commodity.
Call
An option contract that gives the holder the right to purchase a stock, commodity, or other assets at a specified price within a specific time period.
Intrinsic Value
The fundamental value of a company, stock, currency, or product determined through financial analysis without reference to its market value.
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