Explain standard model is the lognormal model
For equities the standard model is the lognormal model, if there are many more ‘standard’ models within fixed income. Does it matter?
Expert
No, not when you are solving the equations numerically, only when you are trying to get a closed-form solution wherein case the simpler the coefficients the more probable you are to get a closed-form solution.
Explain various explanations regarding risk-neutral pricing.
Why is dispersion trading become unsuccessful?
Explain total assets equal the sum of total liabilities and equity.
How could MBAs cope?
List the arguments (variables) of which a FX call or put alternative model price is a function. How does the call & put premium change w.r.t. alteration in the arguments?Both call & put options are functions of just six variables: S
Explain the term utility function and uses.
What are a time series and stocks in stationary?
Explain marked to market by using the implied volatility.
Illustrates an example relates with risk that defined in mathematical terms.
How is Sharpe ratio calculated?
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