Abandonment And Salvage
You give up a boat anchored to a dock that you just don't want anymore. It had $12,000 left in bank payments. You're moving to Somalia, so you don't care about your credit rating. You've abandoning the boat with clear legal intent, i.e. not just leaving it for 3 months while you climb Everest. The bank will sell the boat on eBay (or eBoat) and salvage its value. The boat may bring in a hundred grand. The bank will take its 12k off the top and then charge massively for its time, its lawyers time, and any other fees it can possibly think of so that it may claim another 38k in fees, leaving 50 grand left over after the boat has been sold. It will then hold that money until you try to claim it - and you'll have all kinds of hoops to jump through with judges if in fact you do want to claim that dough - deadbeats who just abandon things and leave the country don't have a whole lot of legal sway here.
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Finance: What Is a Call Option?25 Views
finance a la shmoop. what is a call option? option? option, where are you? okay
yeah yeah. not phone options, call options. and a close but no cigar. a call option [man smokes in a tub of cash]
is the right to call or buy a security. the concept is easy the math is hard.
you think Coca Cola's poised for a breakout as they go into the new low
calorie beverage business. their stock is at 50 bucks a share and you can buy a [man stands on a stage as crowd cheers]
call option for $1. well that call option buys you the right
to then buy coke stock at 55 bucks a share anytime you want in the next
hundred and 20 days. so let's say Coke announces its new sugarless drink flavor
zero it's two weeks later and the stock skyrockets to fifty eight dollars a
share. you've already paid the dollar for the option now you have to exercise it. [man lifts weights]
so you buy the stock and you're all in now for fifty five dollars plus one or
fifty six bucks a share and your total value is now fifty eight bucks. well you
could turn around today and sell the bundle that moment, and you'll have
turned your dollar into two dollars of profit really fast. and obviously had the [equation on screen]
stock not skyrocketed so quickly well you would have lost everything. still you
lucked out and now you're sitting on some serious cash, courtesy of your call [two men in a tub of cash]
options. as for Coke flavor zero turned out to be nothing more than canned water.
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