Explain the econometric models
Explain the econometric models.
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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 the tool of Approximations methods in Quantitative Finance.
Suppose current settlement price on a CME DM futures contract is $0.6080/DM. You contain a long position in futures contract. Presently your margin account contain a balance of $1,700. The next three days' settlement prices are $0.6066, $0.6073, & $0.598
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In brief define each of the major types of international bond market instruments, noting their distinguishing characteristics.The major kind of international bond instruments & their distinguishing characteristics are as follows:
Who introduced Long Term Capital Management Mess?
Is volatility constant?
State the term Option Adjusted Spread? Answer: The OAS stands for Option Adjusted Spread is the constant spread added to a forward or a yield curve to match the mark
Explain different forms of market efficiency.
Explain total assets equal the sum of total liabilities and equity.
Explain possible future paths for an asset, proposed by Boyle Phelim.
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