Question

If the volatility of a stock is .33, find the standard deviation of:

(see the attachment for the remainder of the question).



(u)PS
where Sa(n) is the price of the security at the end of day
log
n.

Image Transcription

(u)PS where Sa(n) is the price of the security at the end of day log n.

Expert Answer

1 Rating

Want to see the step-by-step answer?

See Answer

Check out a sample Q&A here.

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

See Answer
*Response times vary by subject and question complexity. Median response time is 34 minutes and may be longer for new subjects.
Tagged in
BusinessFinance

Derivative Markets

Related Finance Q&A

Find answers to questions asked by student like you
Show more Q&A

Q: I was asked to repost the question.  It is as follows: Assume a security follows a geometric Brownia...

A: In mathematical finance, risk neutral is a probability measure used to support in pricing financial ...

Q: You strongly believe that the price of Breener Inc. stock will rise substantially from its current l...

A: Current, stock price, S0 = $ 137Amount to invest, A = $ 13,700Strike price on call option, K = $ 140...

Q: You have $5,000 invested in a bank account that pays a 6percent nominal annual interest with daily c...

A: Amount invested, PV = $ 5,000Interest rate = 6% annual interest rate compounded daily.Hence, interes...

Q: Assume a security follows a geometric Brownian motion with volatility parameter sigma=0.2.  Assume t...

A: Given that: The initial price=$25Interest rate is 0%Strike price is $22. volatility parameter sigma ...

Q: If the interest rate per day is 0.014%, then what is the annual rate?

A: Interest rate:An interest rate is a percentage on the principal amount at which a lender gives money...

Q: Countess Corp. is expected to pay an annual dividend of $3.97 on its common stock in one year. The c...

A: Calculating the cost of equity using the formula of dividend discounting model. We have,Current pric...

Q: An experiment can result in any of the outcomes 1, 2, or 3.  If there are two different wagers with ...

A: Let's define two matrix as shown on white board.The first matrix is R matrix which shows three possi...

Q: Multinational corporations are exposed to higher risks that primarily come from two significant sour...

A: Expropriation is the act in which taking  over of privately owned property by the government.While, ...

Q: Ed Draycutt is the engineering manager of Airway Technologies, a firm that makes computer systems fo...

A: You have asked a case sudy with four sub parts. I will answer the first three sub parts. Please post...