What are BOOM and CRASH Indices and how do they work?

BOOM and CRASH Indices are Synthetic Indices with an asymmetric relationship between the probability and magnitude of upward and downward price movements.

 

For BOOM Indices, downward movements are more frequent but generally smaller, while large upward movements occur less frequently but have a greater magnitude.

 

The higher the number in the BOOM instrument name, the lower the probability of a large upward movement occurring. At the same time, the magnitude of such movements is greater.

 

CRASH Indices work according to the opposite principle. Upward movements are more frequent but generally smaller, while large downward movements occur less frequently and have a greater magnitude.