Add training workflow, datasets, and runbook

training_data/curated/text/6974c367b8f6223cdf95ae13f4f58605715e9c63b08ad78d27db2cebb61441de.txt

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+678 Part V: Index Options and Futures 
+Example: The table below compares the theoretical values computed with the two 
+formulae, where r = 6% and t = 0.25 (1/4 of a year). Furthermore, assume the futures 
+price is 100. The strike price is given in the first column, and the put price is given 
+in the second column. The predicted call prices according to each formula are then 
+shown in the next two columns. 
+Put Formula l Formula 2 
+Strike Price (Simple) ( Using e-rf) 
+70 0.25 30.25 29.80 
+80 1.00 21.00 20.70 
+90 3.25 13.25 13.10 
+95 5.35 10.35 10.28 
+100 7.50 7.50 7.50 
+105 10.70 5.70 5.77 
+110 13.90 3.90 4.05 
+120 21.80 1.80 2.10 
+For options that are 20 or 30 points in- or out-of-the-money, there is a notice­
+able differential in these three-month options. However, for options closer to the 
+strike, the differential is small. 
+If the time remaining to expiration is shorter than that used in the example 
+above, the differences are smaller; if the time is longer, the differences are magnified. 
+Options on Physicals. Determining the fair value of options on physicals such 
+as currencies is more complicated. The proper way to calculate the fair value of an 
+option on a physical is quite similar to that used for stock options. Recall that in the 
+case of stock options, one first subtracts the present worth of the dividend from the 
+current stock price before calculating the option value. A similar process is used for 
+determining the fair value of currency or any other options on physicals. In any of 
+these cases, the underlying security bears interest continuously, instead of quarterly 
+as stocks do. Therefore, all one needs to do is to subtract from the underlying price 
+the amount of interest to be paid until option expiration and then add the amount of 
+accrued interest to be paid. All other inputs into the Black-Scholes model would 
+remain the same, including the risk-free interest rate being equal to the 90-day T-bill 
+rate. 
+Again, the practical option strategist has a shortcut available to him. If one 
+assumes that the various factors necessary to price currencies have been assimilated 
+into the futures markets in Chicago, then one can merely use the futures price as the 
+price of the underlying for evaluating the physical delivery options in Philadelphia.