Knock-out certificate leverage calculator
Leverage, barrier distance, P&L per 1% move.
Interactive: knock-out certificate leverageMedium
Turbo pricing is refreshingly checkable: intrinsic value times ratio. What the leverage number really means is how close the trapdoor is.
- Certificate price
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- Leverage
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- Distance to knock-out
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- P&L on a 1% move
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Value ≈ (spot − financing level) × ratio; financing costs raise the level daily. Touch the barrier once and the position ends — see knock-out certificates.
The idea behind it
This calculator belongs to Equity Derivatives, where the mechanism it computes is explained step by step, with the formula, what each input means and where the simple model stops being right. Everything is computed in your browser; nothing you type is sent anywhere.
Instruments it applies to
- Equity Forward — The bespoke cousin of the future: a private agreement on tomorrow's stock price, tailored to size and date.
- Variance Swap — A pure bet on how much a market moves — direction irrelevant. Volatility as a tradable asset.
- Warrant — An option in retail packaging — securitised, listed, and buyable in small size through any broker.
- Convertible Bond — A bond with an escape hatch into shares: downside of a bond, upside of a stock — priced in between.
- Autocallable — The world's best-selling structured product: fat coupons while markets behave, a cliff if they don't.
- CFD — Retail's leveraged mirror of any market: pay or receive the price difference, own nothing.
- Reverse Convertible — A fat coupon in exchange for the downside of a stock: you are paid handsomely to sell someone crash insurance.
- Tracker Certificate — The simplest structured product: one-for-one exposure to an index, with none of the protection and all of the issuer risk. An ETF's payoff wrapped in a bank's credit.
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