Sabit Rahimov
Member
@babyik
PFA my comments on your answers to the questions I dare to disagree with
Q2: Graph of Variance Vs correl: Var= 2(1- correl). Option should be A (Straight line) with Max. of 4 and min of 0
Q24: Definitely Sharpe ratio. I have put my comments prior giving the explanation
Q35: Not sure which one you marked, but I marked the one that was convex
Q46: I chose Higher beta, higher return. Though not sure whether they meant expected return or actual return. I may be wrong
Q49: LTCM: Failure to include scenario of competitors holding similar position. This increased the liquidity issue(Schweser notes)
Q66: It can be either Stop-Loss or Stop limit. I don't understand what you mean by Stop-loss limit. I chose Stop-Limit
Q75: it should be "Who to deliver" since the exchange will determine who will get the order since the other party can close its position before delivery it is impossible to state beforehand who to deliver on the contract.Where to deliver is specified in the contract
Q88: BSM cannot value American put since early exercise in optimal and basic condition of BSM to hold is that there should be no early exercise.American calls are usually exercised at maturity and the same with Forwards. American puts can be exercised anytime
All the best!
KR
Uzi
Hi,
in regard to Q75 I'm definitely agree with you. I marked "to whom to deliver the commodity". Delivery location options even for each commodity is defined by the Exchange beforehand and includes provisions on this issue. Short position chooses where to deliver and depending on the locations, price is adjusted Good luck!