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.
What is Vomma or Volga in option value?
Illustrates a swap dealer. A swap dealer is a market maker of swaps and supposes a risk position in matching opposite sides of a swap and in assuring that each of counterparty fulfils its contractual compulsion to
Which is the deciding factor for rejecting or accepting proposed projects while using internal rate of return?
Describe how to calculate the overall balance and discuss its significance.The overall BOP is finding out by computing the cumulative balance of payments by including the current account, capital account, and the statistical discrepancies. The n
What is actuarial approach in Central Limit Theorem?
Where can we get incomplete markets?
Explain in brief the non-diversifiable risk and ways to measure it?
Explain the features of Brownian motion.
What is Information Ratio?
How is estimate of volatility or the implied volatility used?
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