Glossary
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| Sharpe Ratio The Sharpe ratio measures the relationship between risk and yield of an investment. For this a risk-free rate of interest is deducted from the yield and then divided by the standard deviation. The higher the Sharpe ratio, the better the risk-adjusted performance. |
| Short Position An open selling position in a futures contract. |
| Spread Position In the case of options trading, the simultaneous buying and selling of options contracts with different strike prices and/or different expiry dates. In the case of financial (money market) futures, the simultaneous buying and selling of futures contracts with different expiry dates or underlying assets. |
| Standard Deviation Another term for volatility. |
| Straddle Long and short positions with the same number of calls and puts of the same underlying with the same strike prices and the same expiry dates. |
| Strangle A long or short position with the same number of calls and puts on the same underlying with the same expiry date, however, with different strike prices. |
| Strike price The price at which the underlying will be drawn or delivered by the exercise of an option. |
| Swiss Market Index (SMI) The SMI is a capital weighted price index, based on a basket of stocks whose titles are constantly being traded. It covers up to 30 free-float titles of highly capitalized businesses in the Swiss stock market. |
| Synthetic Position Emulation of options or futures contract characteristics by using other derivates. |
| Systematic Risk Systematic risk depends on factors that affect the entire market or segment, so cannot be reduced or eliminated by diversification of a portfolio, but can be mitigated by hedging. |