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| EN CONSTRUCCIÓN |
| Fecha prevista de finalización |
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Octubre 2004 |
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| .01 Dealing |
Market imperfections shows up at the relative value of an asset vs other asset. That is, the ratio.
Ratio:
Quotient resultant dividing two equities quotes. For example, suppose Popular quote's is 44 euros, and BBVa quote's 10 euros. Popular vs BBVA ratio would be 44 / 10 = 4,4.
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| Case 1 |
Buy pair |
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Suppose we are buying Popular vs BBVA at 4.4. We should buy Popular and simultaneously sell BBVA at a price that warrants
Popular quote / BBVA quote = 4.4
Dealing close: Deal should be closed by the inverse deal. At the example, selling Popular and buying BBVA.
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| Case 2 |
Sell pair |
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Suppose we are selling Popular vs BBVA at 4.4. We should sell Popular and simultaneously buy BBVA at a price that warrants
Popular quote / BBVA quote = 4.4
Dealing close: Deal should be closed by the inverse deal. At the example, buying Popular and selling BBVA.
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| Buying and selling could be done at spot or futures dealing.
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| .02 Spot |
| Ratio buying is done by buying asset 1
equities, and short selling asset 2equities. Ratio selling is done by
asset 1 selling and simultaneously asset 2 buying. This delaing may encounter problems
related with liquidity at the short side. |
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| .03 Futuros |
Meff futures: Meff equities futures has a 100 shares nominal.
((Checq any changes athttp://www.meff.com/productos/futacc.htm
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Be carefull with expiration date. |
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Please note there's a difference between spot and futures, called base. |
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Equities quotes input |
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Asset 1 shares quantity |
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Input futures quotes |
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Asset 1 futures quantity |
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