Warrants are not often exercised
Explain: warrants are not often exercised unless the time to maturity is small.
Expert
Warrants are not often exercised until the time to expiration is very small since the market price of the warrant is larger than the exercise value. So the warrant holder will sell it in the secondary market rather than exercising it if he/she wanted to cash in.
Define market for foreign exchange.Broadly described, the foreign exchange (FX) market encompasses the conversion of purchasing power from one currency to another, bank deposits of foreign currency, the extension of credit denominated in a forei
Which model is required for interaction of many companies regarding the process of default?
Explain the deterministic volatility in an option-pricing.
What is the significance of the term additional funds needed?
Explain Capital Asset Pricing Model (CPM).
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What is implied volatility? Answer: Implied volatility is number into the Black–Scholes formula which makes a theoretical price equal a market price.
A stock whose value is now $44.75 is growing on average by 15 percent per annum. Its volatility is 22 percent. The interest rate is 4 percent. You need to value a call option along with a strike of $45, expiring in two months’ time. So, what can you do?
Why should we assume a deterministic stock price path for an equity option? Answer: Because the forward rate curve is not uniquely determined through the finite set
What is a Coherent Risk Measure?
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