Determination of the Own Funds Requirements for the Risk of Binary Options
Radosław Pietrzyk , Paweł Rokita
AbstractBinary options are popular instruments, especially in non-regulated financial markets. Determination of adequate capital, if performed in compliance with binding legal regulations on own funds requirements, may be seriously misleading. This is particularly the case of short-term binary options. The aim of this article is to discuss critically the existing solutions in EU law and to propose some modifications that would be better suited to the nature of this type of financial instrument. The modifications allow to avoid overestimation of adequate capital and better reflect properties of the value of long-term and short-term cash-or-nothing binary options
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|Book||Jajuga Krzysztof, Locarek-Junge Hermann, Orlowski Lucjan T. (eds.): Contemporary Trends and Challenges in Finance Proceedings from the 3rd Wroclaw International Conference in Finance , Springer Proceedings in Business and Economics, 2018, Springer, ISBN 978-3-319-76227-2, [978-3-319-76228-9], 251 p., DOI:10.1007/978-3-319-76228-9|
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