What are random factors for risk-neutral drifts
What are random factors for risk-neutral drifts?
Expert
As along with the HJM model the initial data are the forward rates therefore bond prices are calibrated automatically. One identifies a number of random factors and their volatilities and correlations among them, and the requirement of no arbitrage after that determines the risk-neutral drifts. Even though B, G and M have their names connected with this idea many others worked on this simultaneously.
Under what circumstances will warrant’s value be high? Explain.
What is the function of sinking fund in the retirement of an outstanding bond issue?
Example of Forward and Backward Equations.
Give explanation: The banks try to make short-term self-liquidating loans to businesses.
Illustrates an example an arbitrage opportunity?
What is implied volatility? Answer: Implied volatility is number into the Black–Scholes formula which makes a theoretical price equal a market price.
Explain no arbitrage in classical finance theory and derivatives theory.
Elucidate: Companies with rapidly growing levels of sales do not need to worry about raising funds from outside the organisation.
What is mathematical definition of risk in form of semi-variance?
hi the link is https://myelearning.cavehill.uwi.edu/login/index.php login: 411002468 pass- ls@2014 go into financial management 2 course, the quiz will be from week 1-5 lecture
18,76,764
1955481 Asked
3,689
Active Tutors
1442616
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!