Linear or non-linear in finite-difference methods
Explain the term Linear or non-linear in finite-difference methods.
Expert
Linear or non-linear: Almost every quant finance models are linear, therefore you can solve for a portfolio of options through solving each contract at a time and adding. Several more modern models are nonlinear. Nonlinear and linear doesn’t make this much difference while you are solving by finite-difference methods. Therefore choosing this method gives you much flexibility in the verity of model you can use.
What is dynamically hedge?
Great Corporation has the following capital situation. Debt: One thousand bonds were issued five years ago at a coupon rate of 11%. They had 20-year terms and $1,000 face values. They are now selling to yield 9%. The tax rate is 37% Preferred stock: Two thousand shares of preferred are outstanding,
What are the benefits of “paying late” and how do companies try to do this?
What is complete market and incomplete market in term of probabilistic?
What are the pros and cons of commercial paper relative to bank loans for a company seeking short-term financing?
If we can’t measure calibration parameter how can we choose on its value?
Who gave option-pricing ability to the masses?
Why a different type of mathematics in Quantitative Finance is important?
Explain the design patterns of an MFC application?
You need to price a European, non-path-dependent contract upon a basket of equities. Which numerical method should you use?
18,76,764
1927573 Asked
3,689
Active Tutors
1434891
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!