What is High Minus Low?

High Minus Low, often written as HML, measures how much better high book-to-market stocks perform than low book-to-market stocks. Investment experts created this tool to help understand what makes some stocks give better returns than others. The name comes from taking the returns of high book-to-market stocks and subtracting the returns of low book-to-market stocks….

What are Compound Option Strategies?

Options trading goes beyond simple buying and selling. Traders combine multiple options into packages called compound option strategies. These strategies help manage risk, make investments, or speculate on market moves in ways that regular options trades cannot achieve. Basic Building Blocks Puts and Calls A put option gives traders the right to sell an asset…

What is a Complex Swap?

A complex swap helps people and companies trade different kinds of payments or investments in ways that aren’t simple or standard. Think of it as a special agreement between two parties wanting to exchange things like interest rates or currency payments but with extra twists. These twists make the swap more complicated than regular swaps,…