Explain an example of Brownian motion effects
Explain an example of Brownian motion effects.
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For illustration, in option pricing Brownian motion effects in simple closed-form formula for the prices of vanilla options. This can be used as a building block for random walks along with characteristics beyond those of Brownian motion itself.
Explain the Deterministic modelling approach in Quantitative Finance.
Discuss the fundamental motivations for a counterparty to enter in a currency swap. One fundamental reason for a counterparty to enter in a currency swap is to exploit the comparative benefit of the other in gaining debt financing at a lower int
When we can use Finite difference numerical method?
Explain the experiment of Oldrich Vasicek of short-term interest rate.
What is trustworthy collateral from the lender's perspective? Explain whether accounts receivable and inventory are trustworthy collateral.
What is Value at Risk?
Can I employ real probabilities for pricing derivatives? Answer: Yes you can. But you may require moving away from classical quantitative finance.
Assume that the pound is pegged to gold at 6 pounds per ounce, while the franc is pegged to gold at 12 francs per ounce. Of course it implies that the equilibrium exchange rate ought be two francs per pound. If the current market exchange rate is 2.2 francs pe
Explain when the dividends should be similar to discounted.
Explain in brief about the time value of money?
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