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This pertaining to Q323.1 from the global drill P1.T2 and on page 24 The formula given is slightly different, why is it ,sd^2 * t and not sd*sqrt(t)? Secondly, the answer uses N[(4.09434-3.98640)/0.36) Could you explain the rational in using/obtaining 0.36? Thanks

There is a question at the 36:00 A hedge fund has invested 100 million in mortgage backed securities. The risk manager is concerned about prepayment risk if interest rates fall. Which of the following strategies is an effective hedge against the potential loss due to a drop in interest rates ...

In the part 1 review, i see a total of 5 mocks, mainly A-E I would like to know in what order are they placed? Easiest to hardest? Oldest to newest? Which one is the latest? is there a 2014 one or are they all 2012/10? Is there a recommended order i should take them? e.g from easier to the...

182.3. Assume a one-year American call option (C) and a one-year American put option (P) both have a strike price (K) of $51.00 when the price of a non-dividend-paying stock (S) is $50.00. The riskless rate is 5.0%. What are the lower bounds, respectively, of the American call and American put...

P1, Financial Markets & Products Hull pg 67 If the risk-free rate, , is constant across all maturities, then the forward price should equal the Futures price (forward = Futures price). But this will vary where there is a correlation between the underlying asset (S) and interest rates If the...

Im having trouble understanding this For a positive correlation (future>forward) I/r increases, S0 increases, r increases I/r decreases, S0 decreases, r decreases Negative correlation (forward>future) I/r increases, S0 decreases, r increases I/r decreases, S0 increases, r decreases F0=S0*e^rt...

Could you share in greater detail your study schedule? Source first?notes? or?etc I'll be taking P1 in nov

Did you do every single practice question? There are way too many practice questions imo. Im planning my schedule before i start and was wondering how should i go about tackling them?