Explain all the model and experiments of Robert Merton
Explain all the model and experiments of Robert Merton.
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Credit risk became huge, big, in the 1990s. Practice and theory progressed at rapid speed throughout this period, urged on by several important credit-led events, as the Long Term Capital Management mess (LTCM) was introduced by Merton who had worked on credit risk two decades previously. The subject really took off, not only along the lines proposed through Merton but also by using the Poisson process as the model for the random arrival of an event, as default or bankruptcy.
Explain the conditions for assuming a deterministic stock price path for an equity option.
Discuss risk from the perspective of the CAPM (Capital Asset Pricing Model).
How do flotation costs affect the cost of raising the capital when a company issues new securities?
Explain the term Modigliani–Modigliani measure.
In integrated world financial market, a financial crisis in a country can be quickly transmitted to other countries, causing global crisis. What sort of measures would you suggest to stop the recurrence of Asia-type crisis? Q : How could MBAs cope How could MBAs cope? How could MBAs cope?
How could MBAs cope?
Why is dispersion trading become unsuccessful?
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
Explain the relationship between the European calls, puts value with similar strike and expiration value.
Why are most futures positions closed out through a reversing trade instead of held to delivery?In forward markets, about 90 percent of all contracts that are primarily established result in the short making delivery to the long of the asset und
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