A kid who currently doesn't have insurance and is being transported to Research Paper

A child who at present doesn't have protection and is being moved to another emergency clinic with asthma and pneumonia - Research Paper Example These incorporate the patient’s wellbeing condition, the method of transport, and separation between the two medical clinics, among others (University of Maryland, 2009, p. 47). The sort of clinical hardware required to move a patient affects the money related load of patient vehicle. The kind of clinical gear required is reliant on the wellbeing state of the patient. A patient with a state of coronary illness would require satisfactory frameworks to be available inside the vehicle; empowering the staff to manage any difficulties that may emerge during transport. This converts into a bigger money related weight on the patient. For this situation the youngster shipped has asthma and pneumonia. Asthma and pneumonia are not as serious and basic as coronary illness. Be that as it may, the hardware required for transportation despite everything comprises of costly gadgets, for example, Cardiac screens, beat oximeter, oxygen conveyance framework, and intubation gear including others (Jaimovich and Vidyasgar, 2002, p. 236). The separation between the two medical clinics is vital in choosing the methods for transport. For little separations; intra city transport, ground vehicles are perfect. For enormous separations; intercity transport, air transport is liked.

Tom Nigro Per.6 Essays - Dresses, Toga, Roman Empire,

Tom Nigro per.6 Latin Report It is 20 B.C. furthermore, I live in the Roman Empire, really I live in the city of Rome itself. The Roman Empire is the best force on the planet. In spite of the fact that I have not voyage a lot of I realize that it is made out of the Italian promontory, arrives around the Mediterranean Sea, from the British Isles to North Africa and from Spain to the Persian Gulf. It has taken over 700 years for Rome to set up such a huge realm and battled numerous wars to do as such. We are a republic, represented by a Senate which settles on the greater part of the choice resembles money related and international strategies however until 509 B.C. we were administered by lords. Our present Emperor is Augustus Caesar. My city was established, as legend has it, by the twin siblings Romulus and Remus who were children of the war god Mars. They were relinquished as babies close to the bank of the Tiber River where they were later found by a female wolf and raised by her until certain shepherds safegu arded them. Here the two young men grew as of recently Romulus murdered his sibling in a contention and afterward established the city of Rome which is named after him. I was conceived in Rome and lived here as long as I can remember. I have not gone a long way from my home, just to the extent a days walk. Be that as it may, a few people I know have leased ponies and gone on incredible excursions. Some have even ridden on the exchanging ships that journey the oceans. In terms of professional career I am a shoemaker like my dad and his dad before him. There are numerous specialists here in Rome. There are potters and metal specialists and artisans to give some examples. I have a shop around near the other specialists. My shop has a little yard in the back and a counter in the front where it opens out onto the road. Huge numbers of my individual specialists and retailers live in lofts over their shops however I live in a different high rise not a long way from my work. High rises or insulae are everywhere. Mine is 5 stories and I am lucky to have an overhang sitting above the bustling road underneath. My structure has shops and boutiques in it which i s helpful for me when I need something, however I do need to impart wellsprings and restrooms and showers to the next condo occupants. Since I am not hitched at this point this isn't a lot of a bother for me . As a matter of fact heading off to the open showers is something that I appreciate. The showers close to my loft have an exercise center, gardens, and a decent perusing room that I can exploit. It is a decent an ideal opportunity to meet individuals and associate following a monotonous day. The men obviously are isolated from the ladies and a few showers are held distinctly for the first class. We do have a class framework here. I have a place with the social class called the humiliores or skilled workers and retailers. There are numerous different classes from the rich Senators right down to the Slaves. All individuals here are not rewarded similarly, those with cash are ensured by laws, those without have hardly any rights. I am not lucky enough to be affluent and need to wo rk professionally. My day begins early. I may have a quick bite of a bread with water, around early afternoon I will have an a lot heavier supper of organic product, meat, fish, and wine. After work I head to the showers to unwind and afterward will have my supper. New food is difficult to arrive contingent upon the season and where it originates from, such an extensive amount what I eat is cured, dried, or salted and vigorously prepared with seasonings and herbs to support the flavor. Like everybody when I get up I need to choose what to ear to work. It truly is definitely not an appallingly hard choice. Individuals like me or plebeians wear a knee-length tunic produced using a coarse dull material and it very well may be either short or long sleeved. I put a frock over my tunic which

International Market Entry and Development Research Paper

Worldwide Market Entry and Development - Research Paper Example This lack in basis is very evident in the definitive variables that are practical to separate the universal markets in contrast with each other in order to settle on to enter the market of proper nations. The nations that are picked for activities in the worldwide business are for the most part subject to the components of quickness or individual decision in contrast with variables, for example, size of the market, pace of progress or accommodation (Cateora and Ghauri, 2000). Picking a suitable nation is given indispensable significance attributable to the unfeasibility of attempting to enter all the states and countries in a worldwide setting. This includes money related and gracefully restrictions just as the monstrous measure of likely risk happening from picking a market that is poor (Alon, 2004). Statistical surveying Process It is very vital to direct a careful statistical surveying while at the same time entering in another worldwide market so as to evaluate the potential dang ers in the outside market. Flopping in understanding the issues would bring about executing right choices for inaccurate issues. Global markets are new to the advertiser in this way, there are high prospects of misjudging the issues in the new outside market. In this manner, it very well may be comprehended that it is very basic to do an exploration that is analytical so as to increase an appropriate comprehension of the market circumstances and issues (Zainbooks, n.d.). The exploration methodology for business will include a four stage system. In the initial step, the goals of research with respect to the size of the structure of the market and the idea of the item in the new market are resolved. The structure of the market includes the market size and the improvement stage among others and the idea of the item would include that how the item is distinguished in the new market. This additionally includes finding out the capability of the market for the particular item alongside the methodology of the clients towards the item. The subsequent advance arrangements with organizing or planning a legitimate research plan where the goals of the exploration ought to be translate into specific data necessities. In the third step, the examination plan is actualized and to deduce in the last advance the discoveries and the subtleties are assessed just as deciphered (Zainbooks, n.d.). Item Adaptation and Approaches to Promotional Strategies While entering another outside market, it gets vital for the item that will be acquainted with adjust as per the new remote market. This basically intends to alter the item with the goal that it reflects the qualities of the new market. This is significant as the customers are distinctive in the remote market. This would likewise demonstrate invaluable as this adjustment will help in obliging it among the purchasers and would likewise guarantee delayed infiltration. There are hardly any adjustments that become obligatory for an item w hile entering another outside market. These incorporate the administration guidelines, social basics, for example, regardless of whether the item is reasonable for the customers, innovative contemplations, for example,

Perfect Exploratory Essay All You Need is Thorough Research

Immaculate Exploratory Essay All You Need is Thorough Research Flawless Exploratory Essay: All You Need is Thorough Research Exploratory papers are intended to investigate certain ideas or impression of subject data. They are not the same as different expositions since they will in general give the peruser a more extensive thought on a theme and even beg genuine circumstance of the subject point. Along these lines, it implies that for this sort of composing it is important to accumulate a ton of significant data in light of the fact that the intensity of influence here is demonstrated realities. Rather than persuading the peruser or the crowd in the legitimacy of a postulation, it is conceivable to examine on issues and draw some type of starter finishes of how to determine it. Furthermore, it shapes the center of one’s composition and thinking process as they work through a weak issue. For these types of paper, one should be contemplative and consider the speculation procedure overall establishment for the article to come out as plainly as expected. Exploratory Essay Features Gives more consideration to an issue than a thought. Here, before picking the appropriate one, a few answers for the issue are examined and their quality and shortcomings are resolved. The article can be drawn closer in two different ways: Review †here the end is first drawn and the other exploratory parts written so that it fits the end making the exposition look equally smooth. Improvised †this technique makes the article look increasingly one of a kind and common and is generally favored by certain instructors if not all. Exploratory Essay Structure Presentation In the presentation, an issue is recognized, illustrated, investigated and clarified based on its significance. Additionally one ought to compose brief conversation on: potential reasons for issues, establishment and individuals associated with the issue, potential arrangements. It is required to give a short depiction on the kinds of sources and materials that one looked into during the time of enquiry also. Body The body is a progression of sections that will in general talk about progressively about the subject point. It comprises of a conversation of the enquiry procedure that followed the examination of the specific issues of intrigue. These sections ought to incorporate the accompanying: A prologue to the source and a clarification of the source inclination and use in the investigation procedure. A clarification of some fundamental data found in the source with respect to the issue in dispute. A nitty gritty conversation with regards to why the data acquired from the source is indispensable and how it might assist with taking care of an issue. A kind of close to home contemplation on how the source helped you and how it permitted you to think in an alternate manner about that feeble issue, and how it diminished your desires and guided you to another way to deal with the exploration. End In the end rehash the issue being investigated and its potential causes with outcomes. Audit the establishments and individuals associated with the laid out issues and examine some other inquiries emerging from the examination and why you think they are coming up. Finally, feature potential answers for these issues. What's more, here you go, an ideal exploratory article. At composing administration you can without much of a stretch purchase exploratory paper on the web, totally uniquely composed without any preparation by scholarly specialists. Tail us!

Decision Day Eve

Decision Day Eve So tomorrow is that fateful day. May 1. Otherwise known as the Common Reply Date. The day by which you need to let your colleges know your decision. If youre still undecided: How can we help you make your decision? What more would you like to know about MIT? What are your lingering concerns? I am available, as are all of the bloggers, to field questions below in the comments, all the way through midnight tomorrow If you havent yet replied: As soon as youve made up your mind for sure about whether or not to attend MIT, please let us know your decision through the online reply form at MyMIT. You have three choices: tell us youre enrolling this fall (Yay! Welcome officially to the MIT Class of 2012!), that youre declining our offer of admission (its okay, we know youre making the best choice for yourself), or to request a deferral/gap year(s) before enrolling at MIT (for a gap year, military service, or other reason). Whatever your decision is, please do reply through the online form as soon as you can. This way, we can ensure the fairest treatment of waitlisted students. If you need more time because you dont have complete financial aid information: Students can request an extension of the May 1 deadline in order to complete and contemplate financial aid. Please contact Joanne Cummings in the Admissions Office to request the extension, and be sure to also be in touch with your financial aid officer. If youre already said YES to MIT: Yay! Several things will happen soon. First, you should make sure youve signed the guestbook on MyMIT so you can stay in the MIT Class of 2012 Facebook group. Second, we will begin sending out the Next Big Mailing (NBM) soon start thinking about an email address soon (look for more in a future entry). Were looking forward to seeing you in the fall! If youve already said NO to MIT: First: thank you. Its been a real pleasure getting to know you. Weve spent the last year thinking about you, getting to know you, talking to you, your parents, and more. After a ridiculously competitive admissions process, we chose you from the thousands upon thousands of super-qualified applicants, because we truly believe in you. And, in the process, we grew very attached to you, and not just for what youd bring to the MIT community, but also for the amazing persons you are. Like a wise man once said, for us, its more than a job. Its hard not to get attached. This college process, is, of course, a two-way street. You get to choose where to apply, then we (the admissions officers) choose whom to admit, but the final choice is yours which school is the best fit for you? We knew coming in that approximately one-third of all of the students we admitted would choose to enroll somewhere else. Thats a statistic. But zooming in, there are 500 individuals who find a better match, and letting go of other options can be hard on both sides. That can be emotional. To those of you who have written in with personal letters some bordering on apologies (theres nothing to apologize for!) letting us know that youre choosing another school thats a better fit for you: thank you for your letters, thank you for your friendship, and congratulations on making a great choice for yourself. This isnt the end of the road, and I hope youll feel free to keep in touch and talk about all the amazing things that happen in your life. In the end, wherever you ended up for college, you were going to be an awesome person. I truly and honestly wish you all the best for your next four years and beyond. Youve got an amazingly bright future ahead. If youre on the waitlist: The waitlist is part of the college admissions process. Schools dont yet know if theyll be going to their waitlists, and if so for how many students. For MITs waitlist, I know many of you are curious; however, I wont be able to say anything until I post here, and Ill post as soon as I can, but please be patient. In the meantime, make sure you enroll at another school before May 1. Happy April 30th! Decision Day Eve Tomorrow is May 1, otherwise known as the Common Reply Date. This is the day by which admitted students need to let colleges know their enrollment decision. If youre still undecided: How can we help you make your decision? What more would you like to know about MIT? What are your lingering concerns? I am available, as are all of the bloggers, to field questions below in the comments, all the way through midnight tomorrow If you havent yet replied: As soon as youve made up your mind for sure about whether or not to attend MIT, please let us know your decision through the online reply form at MyMIT. You can reply any time today (April 30) or tomorrow (May 1); the formal deadline is 11:59pm on May 1.   You have three choices: tell us youre enrolling this fall (Yay! Welcome officially to the MIT Class of 2017!), that youre declining our offer of admission (its okay, we know youre making the best choice for yourself), or to request a deferral/gap year(s) before enrolling at MIT (for a gap year, military service, or other reason). Whatever your decision is, please do reply through the online form as soon as you can. This way, we can ensure the fairest treatment of waitlisted students. If you need more time: If you would like to request an extension of your deadline because you dont have complete financial aid information (or some other good reason), please contact Michael Yang in the Admissions Office to request the extension, and be sure to also be in touch with your financial aid officer. If youre already said YES to MIT: Yay! Were looking forward to seeing you in the fall! More information will be available soon here. If youve already said NO to MIT: Thank you for having applied; it was great getting to know you. We know youve made the right decision for yourself, and wish you all the best for your undergraduate years! If youre on the waitlist: I know many of you are curious, but we wont be able to say anything until mid-May, so please be patient. In the meantime, make sure you enroll at another school before May 1. If youre a transfer applicant: The process continues, please continue to be patient Happy April 30th!

18 Cool Creative Poster Ideas

Poster design has come a long way since the 1880s, changing in style for different eras and often strongly influenced by political or social events of the day. Posters have become a powerful and popular medium for advertising (sometimes referred to as street or guerilla marketing). In this blog, we're going to take a look at some of the gorgeous templates in the Lucidpress poster collection and how you can use them effectively to convey your unique message and reach your targeted customer base. Related: How to make a poster—tips & tricks Choosing a design We admit it's not always easy to choose a design, so to help you make up your mind, we've assigned two keywords to each poster. These keywords capture the mood of the poster and what it's ideally suited for. We've also identified "niche" posters, such as real estate or restaurants. Still, remember: Lucidpress templates are fully customizable. If you wish to use our restaurant poster to promote your software business, go right ahead. You can easily change the tone by using different color schemes or fonts. Marketing aesthetics Marketing aesthetics play a central role in creating the proper tone, and they're determined by your use of colors, shapes, lines and patterns. All poster templates here were inspired by different combinations of these key elements. 99Designs succinctly illustrates the six core elements of great design. Some tips: Lines. The Golden Ratio is a number calculated by dividing a line into two parts so that the longer part divided by the smaller part is equal to the whole length divided by the longer part. (Phew.) It's a golden rule for pleasing design. Color. Try to use your brand colors in all business collateral. Use a color picker to get the shades right. Color is an integral element for professional business designs. Shapes. Shapes and images are central to any design, and Lucidpress makes working with them easy and intuitive. Custom shapes can be used to great effect in fun, trendy and modern designs. Textures. Use the Lucidpress image editor to texturize your images and poster background. Texture is a core element of whimsical and innovative designs. Framing. Frames and borders help to focus a viewer's attention. Use them to structure your layout and content, and to layer design elements. Layering adds depth to posters and is a key element of sophisticated, cosmopolitan and luxury designs. Type. Don't forget: Fonts used for educational and research project designs should never be distracting to the reader. In Lucidpress, Pro users can upload custom fonts. Getting started only requires an internet connection—which you clearly already have. Imagine a blank wall. To decorate it, head over to our free online poster maker. Bring your ideas to life! Forests research poster template Informative | Modern Click on the image to see this template. Created with research and educational projects in mind, this poster provides ample space for images and content in a structured, brochure-like design. The slideshow is both modern and practical, and you can easily add or duplicate pages. The beauty of a one-page template is that your design remains consistent. Ready to start designing?Give us a try. Sign up free or sign up with google By signing up you agree to our Terms of Service and Privacy Policy Western wanted poster template Vintage | Fun Click on the image to see this template. Our designers created this template tongue-in-cheek. It's eye-catching and memorable with an instantly recognizable theme. Have excessive quantities of stationery gone missing at work? This is a fun and subtle way to draw attention to outlaw behavior in the office or at home. Standard advertising poster template Business | Multi-functional Click on the image to see this template. This 3-page poster is perfect for marketing your business at trade shows and exhibitions, or it can be used for an online catalog to advertise special offers. The format is deliberately simple so as not to distract from the content and to make it easy to update if you have regular campaigns. Motivational quote poster template Hard-sell | Visual Click on the image to see this template. Motivational quotes are powerful tools to inspire innovative thinking and promote a sense of well-being. Psychologist and motivation expert Jonathan Fader, PhD, says well-structured messages that use strong imagery and appeal to our aspirational nature can be powerful in changing our thought patterns and behavior. Heartland business poster template Business | Multi-functional Click on the image to see this template. This business poster template provides a surprising and unusual variety of content placeholders so you can sneak in a wealth of information. Each placeholder demands your customers' attention, and the longer they're looking at your poster, the more likely they'll absorb your message. Homegrown event poster template Inviting | Eye-catching Click on the image to see this template. We call it Homegrown because this poster has multiple layers, just like a home-baked pie. If you really want to stand out from the crowd, putting a bit of effort into creating a layered poster will help you to demonstrate the depth and originality of your company's vision. Ecosystem scientific poster template Educational | Nature Click on the image to see this template. Blue is the new green—and this eco-theme disrupts the traditional color mold quite innovatively. This huge 36" x 48" poster gives you the physical space to cover even the most complex research projects without having to resort to smaller fonts or cropped images. Weekend Away photo poster template Travel | Visual Click on the image to see this template. This trendy design showcases your professional photographs, but your message still takes center stage. It's ideal for travel and tourism businesses, for exhibitions, and for luxury brands to announce corporate events and exhibit their products. The Weekend Away is a great example of design layering. Swiss Alps travel poster template Urgent | Travel Click on the image to see this template. Contemporary and bold, this poster paints a strong message. It's a single-focus design, and you should customize it with your own bold background photograph and daringly creative fonts. The unusual text layout makes it a unique and original choice for technology startups and entrepreneurs. Nature Retreat poster template Nature | Informal Click on the image to see this template. Inspired by the layout of quality print magazine covers, Nature Retreat is eminently versatile. Our customers have used it in projects as diverse as publishing upcoming event information and showcasing their portfolios, and for school projects. The style is informal and slightly whimsical. Origami Banner event poster template Formal | Artistic Click on the image to see this template. Origami is the Japanese art of folding paper into decorative shapes and figures, dating back to the 1880s. This template combines traditional origami with a fresh, modern look to create a perfectly structured design ideal for formal and professional corporate posters. Block Party poster template Informal | Fun Click on the image to see this template. This is our flagship celebration poster. Its vibrant design and no-nonsense block layout works well for invitations and holiday events. It's a one-pager, easy to modify and with placeholders for the "who-what-when-where-why" information. The blocks and frame design are reminiscent of the calling cards of yesteryear. Night Life poster template Trendy | Events Click on the image to see this template. Like torn classic denims and multi-layered dresses, this design ushers in a new trend of visually captivating posters that challenge design rules—we wouldn't be surprised to see it in the MOMA one day. Light and dark are juxtaposed to evoke excitement and anticipation. Real Estate poster template Eclectic | Real estate Click on the image to see this template. Arguably the most versatile and stylish template in the Lucidpress collection, this block design is ultra-bold. Rather than simply invite, the poster compels customers to attend a home viewing. We've incorporated vintage and trendy elements both formal and informal... and the result rocks. Cobalt Cafà © poster template Sensual | Restaurant Click on the image to see this template. When it comes to real estate, location is everything. And when it comes to food, presentation is everything. The design mimics those used for magazine food pages, arousing your taste, visual and smell senses. The Cobalt is warm, welcoming and very practical. Cut Glass marketing poster template Innovative | Bold Click on the image to see this template. Cut Glass is cutting-edge design, perfect for technology startups and real estate innovators. Diagonal lines are more striking than horizontal or vertical ones. As explained by Vanseo Design: "Their kinetic energy and apparent movement create tension and excitement." Use this template boldly and aggressively. Cosmopolitan business poster template Luxury | Elegant Click on the image to see this template. Cosmopolitan means cultured, suave, polished and refined... an image you may want to cultivate, particularly if you have an international, sophisticated client base. The hallmarks of cosmopolitan design include the avoidance of "fluff," subtlety, attention to detail, intricacy and cohesiveness. Would these tactics serve your brand, too? Reflections company poster template Corporate | Health Click on the image to see this template. The creative inspiration for this design was the subtle reflection of images in water, clouds and shadows, conveying the impression of depth and intelligence. This poster would work particularly well for a beauty technologist, health spa or clinic, or even a luxury brand. Poster design with Lucidpress is simple thanks to our user-friendly, intuitive interface. It gives you all the functionality of traditional desktop publishing software—but without the learning curve needed when using professional packages. Now it's time for you to grab one of our free poster templates and get creative. Feeling inspired? You can design and order your brand new poster right here in Lucidpress.

Uses For Derivatives And Hedging Finance Essay - Free Essay Example

Sample details Pages: 10 Words: 3081 Downloads: 9 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Did you like this example? In  finance, a  derivative  is a financial instrument (or, more simply, an agreement between two parties) that has a value, based on the expected future price movements of the asset to which it is linked-called the  underlying asset  such as a  share  or a  currency. There are many kinds of derivatives, with the most common being  swaps, futures, and  options. Derivatives are a form of  alternative investment. Don’t waste time! Our writers will create an original "Uses For Derivatives And Hedging Finance Essay" essay for you Create order For example, a  cotton  farmer and a  miller  could sign a  futures contract  to exchange a definite amount of cash for a certain amount of cotton in the future. Now by doing this both the parties have reduced their risk. The cotton farmer was saved from the price uncertainty and the miller got saved from the unavailability of cotton. However, there are certain situations where still risk is present. There would be no availability of cotton due to vague reasons or the miller couldnt pay the quantified amount. For these reasons a third party is formed which is called as Clearing House. Although it sloves most of the future contract but not all the derivated that are insured against counter-party risk. From another perspective, both the farmer and the miller have obtained certain amount of risk and also have lessened certain amount of risk. From the farmers perspective he has lessen the risk that the price of the cotton may drop down and has simultaneously gained the risk if the cotton prices go high. Thinking from the millers perspective it has gained the risk if the prices fall down because he might have paid extra from the current prices and it has reduced the risk if the prices go up. Concluding from this situation is that both the parties are under certain type of risk. Speculation and arbitrage Derivatives can be used to obtain risk, rather than to insure or hedge against risk. Thus, some individuals and institutions will get into a derivative contract to gamble on the value of the fundamental asset, betting that the party seeking insurance will be wrong about the future value of the fundamental asset. Speculators will want to buy an asset in the future at a low price according to a contract when the future market price is high, or to sell an asset in the future at a high price according to a contract when the future market price is low. Individuals and institutions may also look for  arbitrage   opportunities, as when the current buying price of an asset falls below the price specified in a futures contract to sell the asset. Derivatives Market The Derivatives Market is meant as the market where exchange of derivatives takes place. Derivatives are one type of securities whose price is derived from the underlying assets. And value of these derivatives is determined by the fluctuations in the underlying assets. These underlying assets are most commonly stocks, bonds, currencies, interest rates, commodities and market indices. As Derivatives are merely contracts between two or more parties, anything like weather data or amount of rain can be used as underlying assets. The Derivatives can be classified as Future Contracts, Forward Contracts, Options, Swaps and Credit Derivatives. Types of Derivatives Market OTC Exchange-traded In broad terms, there are two groups of derivative contracts, which are distinguished on the way they are traded in the market : Over-the-counter  (OTC) derivatives  are contracts that are traded (and privately negotiated) directly between two parties, without going through an exchange or other intermediary during the trade. Products such as  swaps,  forward rate agreements, and  exotic options  are almost always traded through OTC. The OTC derivative market is the largest market for derivatives, and is largely free from revelation of information to other parties except the parties trading with each other, since the OTC market is made up of banks and other highly cultured parties, such as  hedge funds. Revealing of OTC amounts is difficult because trades can occur in private where the transaction is not visible on any exchange. According to the  Bank for International Settlements, the total outstanding notional amount is US$684 trillion (as of June 2008). Of this total notional amount . Because OTC derivatives are not traded on an exchange, there is no intermediary counter-party. Therefore, they are subject to  counter-party  risk, like an ordinary  contract, since each party relies on the other to perform. Exchange-traded derivative contracts  (ETD) are those derivatives instruments that are traded via dedicated  derivatives exchanges  or other exchanges. A derivatives exchange is a market where individuals trade pre-defined contracts that have been standardized by the exchange. In the Exchange Traded Derivatives Market or Future Market, exchange acts as the main party and by trading of derivatives actually risk is traded between two parties. One party who purchases future contract is said to go long and the person who sells the future contract is said to go short. The holder of the long position owns the future contract and earns profit from it if the price of the underlying asset goes up in the future. On the contrar y, holder of the short position is in a profitable position if the price of the underlying asset goes down, as he has already sold the future contract. A derivatives exchange acts as a middle person to all related transactions, and takes  Initial margin  from both the parties to act as a guarantee. Common derivative contract types There are three major classes of derivatives: Forwards Futures Options Swaps Illustration Consider 2 parties (X and Y) settle into a contract on 1st June, 2010 where, X agrees to give 10000 stocks of Hindalco to Y, at a price of Rs. 10 per share, on 29th June, 2010 (expiry date). In this contract, X, who has committed to sell 10000 shares of Hindalco at Rs. 10 per share on 29th June, 2010 has a short position and Y, who has committed to buy 10000 shares at Rs. 10 per share is said to have a long position. In scenario of physical settlement, on 29th June, 2010 (expiry date), X has to actually give delivery of 10000 Hind alco shares to Y and Y has to pay the price (10000 * Rs. 10 = Rs. 1, 00, 000) to X. In case X does not have 10000 shares to deliver on 29th June, 2010, he/she has to acquire it from the market and then deliver the stocks to Y. On the expiry date the profit/loss for each party depends on the settlement price, that is, the end closing price in the market on 29th June, 2010. Depending on the closing price, three different scenarios of profit/loss can be concluded for each party. They are as follows: Scenario I. Closing price on 29 June, 2010 is greater than the Forward price. We assume that the closing price of Hindalco on 29th June, 2010 is Rs. 10.5 Since the short investor has sold Hindalco at Rs. 10 in the Forward market on 1 June, 2010, he can get 10000 Hindalco shares at Rs. 10.5 from the market and then can be delivered them to the long investor. Therefore the person with a short position makes a loss of (10 10.5) X 10000 = Rs. 5000. If the long investor tends to sel l the shares in the market immediately after getting them, he would make a profit of (10.5 10) X 10000 = Rs. 5000. Scenario II. Closing price on 29th June, 2010 is the same as the Forward price. The short seller will get the stock from the market at Rs. 10 and give it to the long investor. As the settlement price is same as the Forward price, no contractor will gain or lose anything. Scenario III. Closing Spot price on 29th June is less than the forward price. Assume that the closing price of Hindalco on 29th June, 2010 is Rs. 9.5 The contractor who has short the shares, who has sold Hindalco at Rs. 10 in the Forward market on 1st June, 2010, will buy the share from the market at Rs. 9.5 and give it to the long investor. Therefore the contractor with a short position would make a profit of (10 9.5) X 10000 = Rs. 5000 and the contractor with a long position in the contract will lose an amount of Rs. 5000, if he sells the shares in the market immediately after getting them. The major shortcoming of physical settlement is that it results in massive transaction costs in terms of actual purchase of securities by the contractor holding a short position (in this case X) and transfer of the security to the contractor in the long position (in this case Y). Further, if the contractor in the long position is actually not interested in holding the security, then he/she will have to incur further transaction cost in disposing off the security. A different way of settlement, which helps in reducing this cost, is through cash settlement. Cash Settlement Cash settlement doesnt include actual delivery of the security. Each contractor either pays (receives) cash equal to the net loss (profit) emerging out of their respective position in the contract. So, in case of Scenario I, where the price at the expiry date (ST) was greater than the forward price (FT), the contractor with the short position will have to compensate an amount equal to the net loss to the c ontractor at the long position. In the illustration above, X will simply pay Rs. 5000 to Y on the expiry date. The reverse case is in the Scenario (III), when expiry date is less than forward price. The long contractor will be at a loss and have to pay an amount equal to the net loss to the short contractor. In the illustration above, Y will have to pay Rs. 5000 to X on the expiry date. In case of Scenario (II) where expiry date equals forward price, neither X nor Y will pay anything to anyone. In case of the physical settlement and cash settlement, the overall loss and profit position is same except for the transaction cost which is involved in physical settlement. Default risk in forward contracts A major drawback of forward contracts is that they are subject to default risk. Irrespective of whether the contract is for physical or cash settlement, there is always a possibility for one party to dishonor the contract. It could either be the seller or the seller. This ultima tely results in the other contractor suffering a loss. The risk of making losses to any of the contractor due to the other contractor dishonoring the contract is called as counter party risk. The major cause behind such risk is the lack of any negotiator between the parties, who could have taken the job of striking a contract properly between the two contractors. Default risk is also known to as counter party risk or credit risk. Forwards Futures Privately negotiated contracts Traded on an exchange Not standardized Standardized contracts Settlement dates can be set by the parties Fixed settlement dates as declared by the exchange High counter party risk Almost no counter party risk Illustration Suppose X has bought a call option of 1000 shares of Tata Steel at a price of Rs 200 per share at a premium of Rs 10. This option gives X, the buyer, the right to buy 1000 shares of Tata Steel from the seller of the option, on or before June 27th, 2010 (exp iry date of the option). The seller has the obligation to sell 1000 shares of Tata Steel at Rs 200 per share on or before June 27th, 2010 (i.e. whenever asked by the buyer). Suppose instead of buying a call, X has sold a put option on 1000 HUL shares at a price of Rs 1000 at a premium of Rs 10. This option is an obligation to X to buy 1000 shares of HUL at a price of Rs 1000 per share on or before June 27th (expiry date of the option) i.e., as and when asked by the buyer of the put option. It depends on the option buyer as to when he exercises the option. As stated earlier, the buyer does not have the obligation to exercise the option. Table 2.2: Differences between futures and options Futures Options Both the buyer and the seller are under an obligation to fulfill the contract The buyer of the option has the right and not an obligation whereas the seller is under obligation to fulfill the contract if and when the buyer exercises his right. The buyer and the seller are subject to unlimited risk of loss The seller is subjected to unlimited risk of losing whereas the buyer has limited potential to lose (which is the option premium). The buyer and the seller have potential to make unlimited gain or loss The buyer has potential to make unlimited gain while the seller has a potential to make unlimited gain. On the other hand the buyer has a limited loss potential and the seller has an unlimited loss potential. Swaps Swaps are contracts to exchange cash (flows) on or before a stated future date based on the fundamental value of currencies/exchange rates, bonds/interest rates, commodities, stocks or other assets. More complex derivatives can be created by combining the elements of these basic types. For example, the holder of a  swaption  has the right, but not the obligation, to enter into a swap on or before a specified future date. Just like trading of equity-linked contracts or commodity contracts; t he trading of foreign exchange traded derivatives or the future contracts has evolved as very important financial activity all over the world. The derivatives whose fundamental assets are credit, energy or metal, have shown a considerable growth rate over the years around the world. Interest rate is the only factor which influences the global trading of derivatives, the most. Derivative Market and Financial Risk Derivatives play a vital role in risk management of both financial and non-financial institutions. But, in the present world, it has become an intensifying concern that derivative market operations may destabilize the productivity of financial markets. To manage risk and to increase returns, the companies, the financial and non-financial firms are using forward contracts, future contracts, options, swaps and other various combinations of derivatives. It is true that in todays competitive world derivatives market is used an instrument for risk management. But, the major concern over here is the main components of Over the Counter (OTC) derivatives that are interest rates and currency swaps. So, the economy of the country is bound to suffer surely if the derivative market instruments are misused and if a major fault takes place in derivatives market. For example: The bubble that bursts during the phase of Harshad Mehta and Ketan Parikh. They used derivatives instrument to arbitrarily increase the rates of some commodity which helped up to certain extend but in the end the bubble burst and the whole countrys economy tumbled. Examples of Derivatives market The overall derivatives market has five major classes of fundamental asset: Interest rate derivatives  (the largest) Foreign exchange derivatives Credit derivatives Equity derivatives: Commodity derivatives: Property (mortgage) derivative Economic derivatives Freight derivatives Inflation derivatives Weather derivatives Valuation Market and arbitrage-free prices Two common measures of value are: Market price, i.e., the price at which traders are willing to buy or sell the contract; Arbitrage-free price, meaning that less profits can be made by trading in these contracts with very little risk. The contractors look at  rational pricing. Determining the market price For exchange-traded derivatives, market price is usually transparent. They are often broadcast and published in real time by the exchange. It includes all the bids and current market price of the particular contract at any point of time. With OTC or floor-traded contracts there are certain complications. As trading is handled manually, it makes difficult to automatically broadcast prices. As there is no central exchange to collate and disseminate prices, there is more complications with OTC contracts. Determining the arbitrage-free price The arbitrage-free price for a derivatives contract is multifaceted, and there are many diff erent variables to consider. The main topic of financial marketing is Arbitrage-free pricing. The  stochastic process  of the price of the underlying asset is very crucial; so a simplified version of the valuation technique is developed the  binomial options model. OTC represents the biggest task in using models as these contracts are not publicly traded and, therefore, no market price is available to authenticate the theoretical valuation. The results i.e. the final price of the most of the models depend heavily on how we have derived our input variables. It is, therefore, common that OTC derivatives are priced by Independent Agents and that both counterparties taking part in the deal should upfront when signing the contract. Criticism Derivatives are often subject to the following criticisms: Possible large losses The use of derivatives can result in increasing use of  leverage, or borrowing. The problem doesnt occur in borrowing the money but when the individual or organization is unable to repay the debt. Derivatives allow  investors  to earn large profits with a little movement in the prices. However, investors could lose large amounts if the price of the underlying moves in an unfavour condition. Counter-party risk Some derivatives (especially swaps) expose investors to  counter-party risk. For example, suppose a person wanting a fixed interest rate loan for his business, but finding that banks only offer variable rates, swaps payments with another business who wants a variable rate, synthetically creating a fixed rate for the person. However if the second business goes bankrupt, it cant pay its variable rate and so the first business will lose its fixed rate and will be paying a variable rate again. If interest rates have increased, it is possible that the first business may be adversely affected, because it may not be prepared to pay the higher variable rate. Large notional value Derivatives typically have a  large notional value. There is a risk of the investor unable to compensate for the losses that he has incurred. Now as the losses has occurred once then the investor would enter into the market to bid come out of those losses but he enters more in to losses. This could possibly lead to a chain reaction ensuing in an economic crisis which has been pointed out by famed investor  Warren Buffett  in  Berkshire Hathaways 2002 annual report. Buffett called them financial weapons of mass destruction. Benefits The use of derivatives also has its benefits: Derivatives facilitate the buying and selling of risk and many people  has a positive attitude towards derivatives on economic system. Although someone loses money while someone else gains money with a derivative, under normal circumstances. But trading in derivatives should not adversely affect the economic system because it is not  zero sums  inà ‚  utility.