Explain the econometric models
Explain the econometric models.
Expert
There is one slight problem along with these econometric models, still. The econometrician develops his volatility models in discrete time, while the option-pricing quant would ideally as a continuous-time stochastic differential equation model. Luckily, in many cases the discrete-time model can be reinterpreted like a continuous-time model (where weak convergence as like the time step gets smaller), and therefore both the econometrician and the quant are happy. Even, of course, the econometric models, being based upon real stock price data, result in a model for the real and not the risk-neutral volatility process. For going from one to the other needs knowledge of the market price of volatility risk.
Explain probabilities and statistics for quantifying risk in finance.
Who described the criteria which make a risk measure coherent?
Describe the long position in an options contract?An option is a contract giving the long the right to buy or sell a given quantity of an asset at a particular price at some time in the future, however not enforcing any obligation on him if the
How are diversifiable risk and undiversifiable risk associated with portfolio?
Explain all the model and experiments of Robert Merton.
How is Utility Function Used?
What is Vega Hedging?
Determine the efficiency of Monte Carlo method.
Illustrates an example of Greeks?
What is calibration in valuation/pricing process?
18,76,764
1932491 Asked
3,689
Active Tutors
1436147
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!