PPRuNe Forums - View Single Post - fuel surcharge
Thread: fuel surcharge
View Single Post
Old 3rd Nov 2008, 21:35
  #10 (permalink)  
egbt
 
Join Date: Jun 2005
Location: Oxford, UK
Posts: 275
Likes: 0
Received 0 Likes on 0 Posts
Then you also have other options which give you a cap and a floor on what you pay. So if the price goes above your cap then you don't pay anymore than that but if it goes under your floor then the minimum you pay is your floor.
Thread drift on/

IIRC known as a butterfly spread, implemented with multiple options.

In the real world, metals and petroleum based products (don’t know about aviation fuel) are not traded on options which are only really used by gamblers (sorry, respected financial institutions), manufacturing companies who actually use the stuff buy forward on the LME or equivalent.

/Thread drift off
egbt is offline