State the term Calibration in financial model
State the term Calibration in financial model?
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Calibration means selecting parameters in your model there the theoretical prices for exchange-traded contracts output by your model match closely, or as closely as possible, the market prices at an immediate in time. In a sense this is the opposite of fitting parameters to historical time series. When you match prices precisely then you are eliminating arbitrage opportunities, and it is why it is accepted.
How are financial or economic variable represented by index?
Rs. Sales 2,40,000 Variable costs 1,44,000 Fixed costs 26,000 Profit before tax 70,000 Rate of tax 40% Firm is proposing to buy the new plant that could generate extra annual profit of Rs. 10,000. The fixed cost of new plant is expected to Rs. 4000. New plant would increase sales volume by Rs. 40,00
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Is volatility constant?
Alpha and Beta Companies can borrow at the below given rates. &nb
What are the difficulties GARCH contained?
Assume you are a euro-based investor who just sold Microsoft shares which you had bought six months ago. You had invested 10,000 euros to purchase Microsoft shares for $120 per share; the exchange rate was $1.15 per euro. You sold the stock for $135 per share
How Value at Risk simply calculated?
Why is Crash Metrics good risk tool?
What is implied volatility? Answer: Implied volatility is number into the Black–Scholes formula which makes a theoretical price equal a market price.
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