Good evening everyone, as I won't be here much tomorrow, I've decided to send you the second part today. I'm devoting myself to one of my favorite, but generally not very widespread species of derivatives, namely the Inline OS. There is no long or short here, as they are suitable for sideways phases.
With inline OSs such as the one shown here, there is a range within which the underlying must move over the entire term. If the upper or lower limit is breached, the bond expires worthless. However, if it remains within the range for the entire term, the bill is always redeemed at € 10 at the end. The bill below is based on the €/SFR rate (0.92/0.97) and runs until June 5, i.e. 2 weeks. I bought it at €1.90 when it was quite close to the lower limit. I mostly trade currency pairs or oil with these bills. Stocks also work, but I would only take large stocks. At the moment I have one on $BNTX (-1,17%) and on $RHM (-3,99%) . Smaller, more market-oriented stocks can easily be pushed over the barrier by the issuer if they are close to one of the limits. That's why I stay away from them.
So the topic is relatively easy to deal with. Nevertheless, I hope it has been informative for you. If you have any questions about this very interesting product, please feel free to ask.
I wish you all a pleasant evening.
