Derivatives

INTRODUCTION “A derivative is like a razor, you can use it to shave and make yourself attractive for your girlfriend, you can slit your throat with it or you can use it to commit suicide.’(Anon.) This statement describes to us the problems, and on the other hand rewards, that the proper use of derivatives can bring. The derivatives market has developed responding to the uncertainty about prices, and therefore provided a means of separating out this price volatility. The tendency

And all the difference here is the reason why options require a premium. ④ Swaps Swaps now occupy a position of central importance in over-the-counter derivatives market. The statistics produced by the Bank for International Settlements show that about 58.5% of all over-the-counter derivatives are interest rate swaps and a further 4% are currency swaps. A swap is an over-the-counter agreement between two parties to exchange cash flows in the future. The agreement defines

It being a wide topic had a limited time. Share market is so much volatile and it is difficult to forecast anything about it whether you trade through online or offline. Limited resources are available to collect the information about the derivative trading. Some of the aspects may not be covered in my study.The study shows that most of the investors our money in Fixed Deposits because this is the safer investment alternative among the other entire investment alternative for the investors

settlement form (cash or physical) are entirely up to the parties to the contract.  * Forwards entail both market risk and credit risk. Those who engage in futures transactions assume exposure to default by the exchange's clearing house. For OTC derivatives, the exposure is to default by the counterparty who may fail to perform on a forward. The profit or loss on a forward contract is only realized at the time of settlement, so the credit exposure can keep increasing.  * With futures, credit risk

govern reporting of those transactions. The summary under FASB 133 says that at the inception of the hedge, an entity that elects to apply hedge accounting is required to establish the method it will use for assessing the effectiveness of the hedging derivative and the measurement approach for determining the ineffective aspect of the hedge. These methods must be consistent with the entity 's approach to managing risk. For interest rate hedging strategy, swaps are used to hedge. And most importantly, interest

The Roots of the Current Global Food Crisis Today, the economic state of our world is highly connected and international. Therefore, the global market influences food accessibility and hunger on an exceedingly large scale. The global food economy exists within a complex system that has widespread dire consequences if it finds itself in a crisis like we are currently seeing. While it is a common perception that the global food crisis is occurring due to shortages in supply and increasing demand,

Do NHL teams profit maximize? Explain how the authors come to this conclusion. Overview: Before we dive into the details on whether the NHL team or any sports team for that matter maximize profit, it would be worthwhile to answer 2 basic questions as put forth by the author:  Would a sports fan not go to a game which he is die-hard fan of because he/she thinks the team profit maximizes?  Would a sports team forego additional revenue? As with any commodity, price of an arena seat is

Calculus IA Section 2, Part B 4. A particle moves along the x-axis with position at time t given by x (t) = e-t sin t for 0 ≤ t ≤ 2π. (a) Find the time t at which the particle is farthest to the left. Justify your answer. Answer: x’ (t) =e-t sin t + e-t cos t = e¬¬¬-t (cos t – sin t); x’ (t) = 0 when cos t = sin t. Therefore, x’ (t) = 0 on 0 ≤ t ≤ 2 π for t = π/4 and t = 5 π/4. For the absolute minimum are at t = 0, π/4, 5 π/4 and 2 π. The particle is farthest to the left when t = 5 π/4. (b) Find

These previous weeks have been a roller coaster ride for me in calculus class. We covered several derivative rules and applied them during lecture and even homework. On discussion day, I took the quiz for these rules and managed to get a perfect grade. On the 27th of October, I managed to sleep past eleven o'clock. Unfortunately, I missed on the introduction to the chain but I was still able to get a note from a friend of mine. That night I decided to attempt the assigned homework. I felt that this

coupled Burger’s equations with implementation of the homotopy perturbation method. The numerical results are compared with the exact solution at special cases of the fractional derivatives. The results reveal that the proposed method is very effective and simple. Keywords: Fractional differential equations; Caputo’s derivative; Homotopy perturbation method. MSC 2010: 65N20; 41A30. INTRODUCTION Ordinary and partial fractional differential equations (FDEs) have been the focus of many studies due to