I thought it may be helpful to start a thread on these questions.
my first question....
who gets question 3)?
Why is delta = 0 as the dividends are reinvested into the index? shouldnt there still be a delta >0 in this case?
then the statement S(00 IS THE TIME - 0 PRICE FOR A TIME -1 PAYOFF OF AMOUNT S(1) REFERS TO S(0) BEING THE PREPAID FORWARD PRICE BECAUSE DELTA = 0? YES NO?
EXPLANATION PLEASE SOMEONE.
my first question....
who gets question 3)?
Why is delta = 0 as the dividends are reinvested into the index? shouldnt there still be a delta >0 in this case?
then the statement S(00 IS THE TIME - 0 PRICE FOR A TIME -1 PAYOFF OF AMOUNT S(1) REFERS TO S(0) BEING THE PREPAID FORWARD PRICE BECAUSE DELTA = 0? YES NO?
EXPLANATION PLEASE SOMEONE.
NOVEMBER 2014 - SOA 76 HELP THREAD!!
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