Description

Two forms of directional risk investors can take and intuitively explains the bid-offer spread and its main drivers. It also explains the difference between exchange traded and over the counter (OTC).

Learning Objectives

---

1. Recall the key concepts of financial marketplaces.
2. Interpret price quotations and bid-offer spreads.
3. Recall the meaning of spot price.
4. Identify the risk profiles and trade motivations of long and short positions.
5. Recall the meaning of market price quotation.
6. Differentiate between last price vs. bid and ask/offer.
7. Differentiate between exchange-traded and over-the-counter (OTC) markets.