docskeptic
New member
My broker requires me to complete a CLP tutorial in order to trade certain instruments. I can't by the love of god solve these two questions. No matter which formulas I use, I keep getting 4.7-ish for the first one and 35-ish for the second one. Would love for someone to hint me in the right direction.
1) Assume a turbo certificate on ABC share. The certificate has a strike and barrier set at EUR 36.00. The share is trading at EUR 40.00 and the certificate at EUR 4.20. The current leverage is 9.5 (the price of the share divided by the price of the certificate). The price of the share increases to EUR 45.00. What is now the leverage?
My assumption is that the certificate price needs to change...
a) 12.0
b) 4.9
c) 3.2
2) Assume a turbo certificate on ABC share. The certificate has a strike and barrier set at EUR 36.00. The share is trading at EUR 40.00 and the certificate at EUR 4.20. The current leverage is 9.5 (the price of the share divided by the price of the certificate). The price decreases to EUR 37.00. What is now the leverage?
Do I need to calculate the leverage differently in this one? I would have used the same formula as in 1)...
a) 3.2
b) 15.5
c) 30.8
1) Assume a turbo certificate on ABC share. The certificate has a strike and barrier set at EUR 36.00. The share is trading at EUR 40.00 and the certificate at EUR 4.20. The current leverage is 9.5 (the price of the share divided by the price of the certificate). The price of the share increases to EUR 45.00. What is now the leverage?
My assumption is that the certificate price needs to change...
a) 12.0
b) 4.9
c) 3.2
2) Assume a turbo certificate on ABC share. The certificate has a strike and barrier set at EUR 36.00. The share is trading at EUR 40.00 and the certificate at EUR 4.20. The current leverage is 9.5 (the price of the share divided by the price of the certificate). The price decreases to EUR 37.00. What is now the leverage?
Do I need to calculate the leverage differently in this one? I would have used the same formula as in 1)...
a) 3.2
b) 15.5
c) 30.8