Explain experiment of Vasicek of short-term interest rate
Explain the experiment of Oldrich Vasicek of short-term interest rate.
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Oldrich Vasicek modelling a short-term interest rate like a random walk and concluded as interest rate derivatives could be valued by using equations the same to the Black–Scholes partial differential equation.
Explain the term Value at Risk.
Who concluded that stock prices were unpredictable and coined the phrase ‘market efficiency’?
Explain the main motive behind the experience approach to forecasting?
Illustrates an example of Poisson Process?
What are Capital Market Line and Market Portfolio?
Explain in brief about the time value of money?
Illustrates an example of real probabilities to price derivatives?
Why is Value at Risk important? Specified with reasons?
Explain normal distribution model proposed by Louis Bachelier.
Describe Euronote marketEuronotes are short-term notes written through a group of international investment or commercial banks termed a “facility.” A client-borrower makes an agreement along with a facility to issue Euronotes i
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