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The first convex frontier and the second linear frontier both become parabolae when plotting the expected return over the variance (aka volatility squared) instead of the volatility (aka standard deviation). Thus there is nothing special about the linearity of the second frontier, it's a degenerated hyperbola.
Hi , cheers for the video really, am i too old at 34 to start a career in finance " asset management ", meaning will i still be recognized and considered after graduation by employers i am considering doing a Master in 1 year? thanks a lot for your response
@@malikmimoun4938 Well, I was assuming that your intention is to work in a German speaking country. And trust me, a Whu master alone will not get you into client facing positions, you have to be able to speak the local language there. But if your only interested in non client facing activities you'll be fine.
I love this video but it’s not very quantitative. A more robust strategy is growth strategy or momentum strategy in asset pricing. I actually have an episode here coding this strategy from scratch using live stock quotes from quantmod package using R language. Enjoy and welcome to subscribe! ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-jADAUxtkigY.html
I have not seen such a brilliant exposition of this rather confusing topic before. Of course, explanation on martingales is imprecise but is par for the course. Anyone watching this video should have a clear understanding of how based on market prices and assuming no arbitrage conditions, so called risk neutral probabilities can be inferred in discrete time setting. This will be useful for understanding continuous time setting risk neutral pricing. Thanks Prof Rudolf!!
I know it's probably common knowledge, but I haven't looked up the formula and tried to work it out by myself according to the video and to my own research, and I came up with c=(Su-X)/((Su-Sd)/S0)-((Su-Sd)/(1+i) for the price of a call option for one share. I'm gonna look up the actual formula and see how wrong I was.
What about fixing the Italian employment regulations first? Prices are also unreasonably high. There are countries which are better balanced in that sense. The whole system needs a rework but it should be gradual.
This is so interesting. Most organisations, even when declared to be open to diversity, in fact don't allow the biases to come to the surface, so there is in fact no room for awarness, and consequently no willingness to materially "include" diversity. Would be glad to join the research or the discussion in case. Kindest regards.
....ist der Gegentwurf zum Gesagten sowas wie budgetierte Liebe ? (früher konnte man wenigsten nach die Lebensumstände anpassen innerhalb bestimmter Grenzen...das scheint heute nur weniger denn je zu gehen (und das obwohl selbst bei mir schon wieder Obstschälchen überquellen! dann kann doch was nicht richtig sein?)
Only problem is that german youth has the same problem - in case you missed it on your map, the one with 54% 0:37 - and that guy with the bakery having no money to pay anyone fairly.... so guess what... the germans wait for more refrugees to fix their sick economy :D
Yes, an incredible pedagogic performance, but why is it called Euler equation. Euler lived in 17th century, at the time mathematical expectation just came into being.
I swear I have been looking for the way to derive SML from CML for few days in Google; visiting too many pages of knowledgeable content. This is the only one that give me the simple explanation of the derivation. Bow down to the greatest teacher of the Universe ...
Hello dear professor, we are iscae casablanca student preparing for derivatives exam tomorow. We are watching your video, and we notice a mistake, if the price goes down : 1000-260= 740. Best Regards :)
The price, if the stock goes down, does not have to be the same ratio as the up-price. It's just an arbitrary number. If you want the price to be 740 in the down-state, the call value would still be 0 in that state (it expires). You will, however, only buy 4.0385 shares and borrow 284.61 resulting in a value of your shares of 508.85 (up) and 298.85 (down), respectively. You will have to repay 284.61*(1+0.05)=298.85. This results in a payment of 210 if the price goes up and 0 if the price goes down. Your call value would thus be 119.23 > 100.
