Explain Modern Portfolio
Explain Modern Portfolio.
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Modern Portfolio Theory represents each asset by its own random return and after that links the returns on different assets through a correlation matrix.
How much more demand of return is appropriate for a share of common stock by risk-averse investors, when compared to a Treasury bill?
Why is traditional, simple VaR measurement not coherent?
Explain the denotation a utility function and how it can vary between investors?
Briefly explain the operating leverage effect and the reason for it to occur? What are the advantages and limitations of high operating leverage?
Explain number of dimensions in Monte Carlo method.
Illustrates example of Brownian motion?
When the quantitative finance is disrepute?
What are the pros and cons of commercial paper relative to bank loans for a company seeking short-term financing?
What about exotic or over-the-counter (OTC) contracts?
Grecian Tile Manufacturing of Athens, Georgia borrows $1,500,000 at LIBOR and a lending margin of 1.25 percent per annum on six-month rollover basis through London bank. If six-month LIBOR is 4 ½ percent in the first six-month interval and 5 3/8 percent over the second six-mo
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