Lecture 2: Pricing Forwards and Futures This lecture studies the pricing of forward and futures contracts. We first focus on the similarities of the contracts and derive…

Slide 11 Capital Structure Katharina Lewellen Finance Theory II February 18 and 19, 2003 Slide 2 2 The Key Questions of Corporate Finance Valuation: How do we distinguish…

Slide 1Fi8000 Option Valuation I Milind Shrikhande Slide 2 A Call Option A European call option gives the buyer of the option a right to purchase the underlying asset, at…

CFA Q & A CFA Q & A 14-06-2015 Ex pp59: A 1-year call option on Cross Reef Inc. with an exercise price of $60 is trading for $8.The current stock price is $62. The…

Slide 1 BOPM FOR PUTS AND THE DIVIDEND- ADJUSTED BOPM Chapter 6 Slide 2 Binomial Stock Movement Slide 3 Assumption Assume there is a European put option on the stock that…

Slide 1 An Introduction to the Market Price of Interest Rate Risk Kevin C. Ahlgrim, ASA, MAAA, PhD Illinois State University Actuarial Science & Financial Mathematics…

Slide 1 Lecture 2 Present Values Corporate Finance Lecturer: Quan, Qi Winter 2010 Slide 2 2 Topics Covered Introduction to present value Opportunity cost of capital Net present…

Slide 1 1 Lecture 4 CIP, UIP, PPP & Empirical testings 2012 International Finance CYCU Slide 2 2 Fundamentals of Int’l finance Three parity theories from different…

Properties of Stock Option Prices Chapter 9 Notation c : European call option price p : European put option price S0 : Stock price today X : Strike price T : Life of option…

EXERCISE A3 Due: June 16 PART 1 - BASIC QUESTION 1 Suppose that there are two independent economic factors, F 1 and F 2. The risk-free rate is 6%, and all stocks have independent…