Questions having to do with financial mathematics. Please note that for questions in quantitative finance, quant.stackexchange.com is perhaps a better site.

learn more… | top users | synonyms

1
vote
2answers
187 views

Stochastic/finance monte carlo question

When pricing a european option by monte carlo over 30 days for instance, what's the difference between one big 30 day jump vs 30 one day steps?
5
votes
5answers
4k views

Understanding Black-Scholes

Assume I have only basic math knowledge, what specific areas of math would I need to learn in order to understand the following webpage: Black-Scholes Many thanks.
1
vote
2answers
215 views

Principal and Annuities

Suppose you want to accumulate $12,000$ in a $5 \%$ account by making a level deposit at the beginning of each of the next 9 years. Find the required level payment. So this seems to be an annuity due ...
2
votes
1answer
202 views

Annuities and Loans

A loan for $8,000$ must be repaid with 6 year end payments at an annual rate of $11 \%$. What is the annual payment? I know that the present value of an annuity with end payments is $\frac{1-v^n}{i}$ ...
3
votes
2answers
250 views

Measuring Financial Investment Performance

I'm trying to understand how the performance of financial investments are measuring when the asset has multiple points of investment. For example, say I invest ...
2
votes
2answers
2k views

Repayments of a loan with compound interest

Suppose I have a loan of M dollars. At the end of each year, I am charged interest at rate R and make a repayment of P. The loan is repaid after n years. How long (n) does it take to repay the loan ...
4
votes
1answer
277 views

How to determine annual payments on a partially repaid loan?

A 10-year loan of $500 is repaid with payments at the end of each year. The lender charges interest at an annual effective rate of 10%. Each of the first ten payments is 150% of the amount ...