TTC fare hike Essay

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4th edition of the Options
Trading Simulation
Welcome Address

Presented by Alain Miquelon

President and CEO
Montréal Exchange


4th edition of the Options
Trading Simulation
Mandatory Components

Presented by Stéphanie Alison Berthiaume

Marketing Manager – Corporate Communications
TMX Group | Montréal Exchange


May the best teams win!
• The 3 teams that will have respected the mandatory components while accumulating the best return after 9 trading weeks will receive prizes.
• A certificate of participation will recognize the best performing team per university as well as the 50 best teams in the
Canadian ranking.


Mandatory Components


Trading Simulator (1/2)


Trading Simulator (2/2)
• Team account activation in the simulator
• Virtual porfolio of $100,000 with real-time quotes
• Reference tools
– Quick guide
– Video tutorials
Look into your spams if needed
Add to your favourites


Simulation Key Dates
• The Simulation starts on Monday, February 3rd, at
9:30 a.m. (EST).
• Each team must trade a minimum of 5 Canadian options classes chosen from 30 of the most active securities on the market.
• The surprise trading strategy will be unveiled by email on Thursday, February 13th at 4:00 p.m. (EST).
• The Simulation ends on Friday, April 4th, at 4:00 p.m.

Mandatory Strategies
Each team must execute 4 predefined options strategies:

long put secured put long straddle bull call spread

Each strategy must have a minimum notional value of
$5,000 or 10 options contracts.
Mandatory strategies must be traded in a single transaction, and not by legs.
Refer to strategy sheets at


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Write to if you have questions
Talk with the student ambassador for the Montréal
Exchange at your university


Options Trading Simulation
Mandatory Strategies
Presented by:
Dimitrios Zervogiannis
Business Development Manager,
Equity Derivatives, Financial Markets


4 Mandatory Strategies!
• Long put
• Secured put
• Long straddle
• Bull call spread


Strategy Overview
For each strategy, we will take a look at:
• The set up
• Risk and reward
• Why use this strategy?
• What type of stock to use this strategy on


1. Long Put
• Set up: simply buy a put
• Risk: premium of the put
• Reward: strike price minus premium paid

Why long a put?

What Type of Stock?

You’re bearish on the underlying and are anticipating a fall You’re looking for an alternative to shorting a stock
You want to take advantage of leverage
A stock that may be negatively impacted by news and current events
A stock that may have a pull back
A stock that is overvalued and that will lose value before expiration of the put


2. Secured Put
• Set up: short a put; hold cash required to purchase stock
• Risk: limited to fall in stock price
• Reward: limited to premium received
Dec 2013
ABC is trading at
5 months later…
ABC trading above $18
5 months later…
ABC trading below $18


• Hold $18,000.00 cash (no shares)
• Sell 10, 3 month $18.00 puts on ABC
• Collect $0.70 or $700.00 (premium)
•The put will expire
•No shares are ever transacted
•There is a net profit of .70 or $700.00
•The put will be assigned at $18.00
•1000 shares are now in the account
•You still get to keep the $0.70 premium
•You own the shares of ABC at a cost base of $17.30

• Why short a put?
To offset the cost of the underlying Buy shares below market price

• What type of Stock?
A stock you are slightly bullish on and want to own
A stock that may have a small