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sir in interest rate options, i watched the videos but i just have one doubt
Do the cap floor and collar apply only to exchange traded interest rate options or also to interest rate guarantee(otc)?The cap, floor, and collar concepts can apply to both exchange-traded interest rate options and interest rate guarantees (OTC).
A cap involves setting a maximum interest rate, a floor sets a minimum interest rate, and a collar combines both a cap and a floor to create a range within which the interest rate is confined. These concepts can be used in both exchange-traded options and OTC arrangements.
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