Explain the term annuity
Explain the term: annuity. How can continuous compounding benefit an investor?
Expert
Annuity is a chain of equal cash flows that is spaced uniformly over time. The increasing affect the number of compounding periods per year is to increase the investment’s future value. If the interest is compounded very frequently, the future value will be more. The smallest number of compounding period is used when we compute continuous compounding.
For equities the standard model is the lognormal model, if there are many more ‘standard’ models within fixed income. Does it matter?
Explain Certainty equivalent as a function of the risk-aversion parameter.
Explain the three financial factors that affect the value of a business.
Explain decision features in Monte Carlo method.
What are the levels of implied volatility? Answer: Implied volatility levels the playing field so you can compare and contrast option prices across strikes and expir
Illustrates an example of LIBOR Market Model?
What should a borrower consider before issuing dual-currency bonds? What should an investor consider before investing in dual-currency bonds?
Explain the term IGARCH as of the GARCH’s family. Answer: IGARCH: It is an integrated G
Illustrates an example of dispersion trading?
What are the modern approaches uses for forecast volatility and model?
18,76,764
1928894 Asked
3,689
Active Tutors
1436979
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!