In the 3 tier securitization structure there would be Senior tranch, mezanine tranch & equity tranch. Suppose there are enough cash-flow received (say A) from the underline security to pay off the interest to Senior (B) & Mezanine tranch (C) holder & remaining amount of (A-B-C) say K, So, here...
Following are the closing price (P) and yields(Y) of a particular liquid bond over the past few days:
Monday: P= 106.3 Y= 4.25%
Tuesday: P= 105.8 Y= 4.20%
Wednesday: P= 106.1 Y= 4.23%
What is the approximate duration of the bond?
A 18.8
B 9.4
C. 4.7
D 1.9
Q1) You are the risk manager of a fund. You are using the historical method to estimate VaR. You find that the worst 10 daily returns for the fund over the period of last 100 trading days are -1%, -0.3%, -0.6%, -0.2%, -2.7%, -0.7%, -2.9%, 0.1%, -1.1%, -3.0%. What is the daily VaR for the...
An option portfolio exhibits high unfavorable sensitivity to increases in implied volatility and while experiencing significant daily losses with the passage of time. Which strategy would the trader most likely employ to hedge his portfolio?
Choose one answer.
a. Sell short-dated options and buy...
Can u please explain how to convert a non-recombining tree to a recombining tree under Vasicek Model,,,,?
is it can be arrived only assessing the probability of UP & DOWN movement last nodal point...by averaging the terminal middle node of of non-recombining tree?? or some other approach is also...
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