Going Short on Volatility

Wagering against large unexpected price shifts. It work great under normal circumstances, but poorly when surprises happen. Since the government bails out large financial institutions these days the government bears some of the risk, and little of the reward.

See also EBITDA, Injection Effect, Negative Skewness and Rent Seeking.

This bit of jargon has been viewed 6,773 times.

Return To Finance Jargon