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In reference to R19.P1.T3.FIN_PRODS_HULL_Ch10_American_Options_Pull-Call-Parity-Relationship :- (S - K) <= (C - P ) <= ( S - Ke^ -rt) => Put-Call-Parity Relation for American Options Can someone please help me how we get to the above for American Options... :-(

@David Harper CFA FRM Thanks so much for the above.Think for the sake of time, for now I will steer clear of this now since it is out of the scope of the exam...and revisit later for purposes of a better understanding/knowledge's sake...

In reference to R25.P1.T4.ALLEN_Ch 2& 3:Topic:TAYLOR_SERIES_APPROXIMATIONS:- I am trying to figure as to how we get N(d1) = .383 Can someone please break this down for me... if we were to do this in the exam, how would we go about it... :-( ..? Thanks much as always.

@David Harper CFA FRM Thank you so so much for laying out the above - super clear now :) :)

@David Harper CFA FRM Thanks so much for the above explanation :) So is this the takeaway just to make sure I understood it right ...or if there are still some glitches in my understanding on this topic... 1) When the underlying is a Stock:- We use the Delta-Normal to calculate the VAR VAR =...

In reference to R25.P1.T4.ALLEN_Ch 2& 3:Topic:VAR_LINEAR_DERIVATIVES :- In cases, where the Delta is a constant, is the value of the constant always 250 or do we have different valued constants for Different- " Types " of Linear derivatives..? Like say 350 for a "Oil Futures" Contract..?

@David Harper CFA FRM Thanks so much for the clarification ...my bad on the spreadsheet...The Sortino is indeed correctly calculated in the spreadsheet...not sure how my eyes misread the formula...but thanks for confirming the Downside Deviation formula....

In reference to R8.P1.T1.Amenc_Ch4_RISK_MGMT_Topic: SORTINO_RATIO_DOWNSIDE_DEVIATION_FORMULA:- The Formula for Sortino Ratio = ( Average PortFolio Return - MAR ) / Downside Deviation where Downside Deviation should be = SQRT[ ( {Portfolio Return - MAR ) ^ 2 } / N ]...

@QuantMan2318 Was stuck on this ..Thank You so so much ! :-)

In reference to R26.P1.T4.DOWD_Topic: EXPECTED_SHORTFALL :- For finding the ES, we find the Total area under the Tail and then divide by (1-alpha) to get the average amount of Loss under the Tail ...Shouldn't we dividing the Total area under the Tail by Alpha instead of ( 1-Alpha). Am probably...

@David Harper CFA FRM Thanks so much for the clarification ..just wanted to make sure... @brian.field Thanks for the additional example

In reference to R27.P1.T4.Hull_Ch13_15_19:Topic: BINOMIAL_TREE_OPTION_PRICING :- Hi, I just wanted to clarify something on this topic in the example illustrated below:- Here , the Volatility is a given input = 30 % Time = 1 yr So, then the Magnitude of Up Jump , u should be solved to be = e ^ [...

@David Harper CFA FRM Thanks so very much for the clarification David ! Clear as the sky now :-)

In reference to R27.P1.T4.Hull_Ch13_15_19:Topic: WARRANT_DILUTION_HAIRCUT_FACTOR:- The BT Notes IMO rightly sates that the Reduction/Dilution factor , the Haircut Factor = N/ ( M + N) where M= No of Warrants ; N = No of Outstanding Shares But The John Hull Notes state the Haircut/Reduction...

@brian.field @David Harper CFA FRM Thanks so much for the above insight. It's good to know that N(x) can be retrieved using a Prometric calculator for any x and also for the purposes of the exam, very good to be aware of the above 3 scenarios and keep them in mind for the exam- Thank you ! :)

In reference to R27.P1.T4.Hull_Ch13_15_19:Topic: BLACK-SCHOLES-MERTON_MODEL :- In the exam, if we were to calculate the Call or Put Option prices using the BSM Model, would it be safe to assume that N(d1) & N(d2) would ALWAYS be provided given....? There are formulae to calculate the d1 and...

@David Harper CFA FRM Thanks so much for the in depth explanation and the excerpt from AMENC was perfect !! ... :) Thanks a ZILLION ! :-)

@David Harper CFA FRM Have one last follow up question on this... How are we calculating the T-statistic to be IR * SQRT( TIME) .....Not sure why IR is being used in the T-statistic..?

@David Harper CFA FRM Thanks so much for taking the time to clarify my ignorant doubts with so much patience. My apologies for being a pain on this topic. Infinite gratitude :-)

@David Harper CFA FRM The above example is indeed awesome ! - I have one little hitch in my understanding where you state the initial parameters:- " say Rf = 1.0% and the market's excess return = 4.0%. Consider the portfolio's gross return is 6.0% so its excess return = 5.0%" If the portfolio's...