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Expanding Your Options with Nasdaq Derivatives

IBKR Podcasts

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Index Options and Their Use for Hedging

This chapter explores the use of large index options for hedging purposes by institutions. It discusses the differences between index options and ETF options, as well as the advantages of cash settled index options for hedging. The chapter also covers the distinctions between cash secured puts and shorting puts, the tax benefits of index options, and the value of volatility information in driving interest in capital markets.

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