# Tagged Questions

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

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### Regarding “Two Singular Diffusion Problems” by William Feller

I'm currently reading the research paper, Two Singular Diffusion Problems, by William Feller (1950). However, I don't understand how Feller derived the solution $(3.5)$ given equation $(3.4)$ in his ...
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### How to use the BA II Plus financial calculator to solve for IRR and NPV?

I've calculated the answers manually but would like to learn how to do so on the financial calculator to save time on the test and minimize errors. How to do this? Problem: You have been offered a ...
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### Savings account interest rate

Just a brief question regarding bank interest rates, my apologies if this is a duplicate, I did a quick search but came up with no results relating to my question, surprisingly. Also, please excuse ...
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### Method for finding a arbitrage opportunity when market price of call is incorrect

The solution of the Black-scholes equation is the price of a European call. And the option price assumes the underlying stock is a geometric Brownian motion with volatility $\sigma_{1}>0$. ...
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### How to test if two sets of data are closely related?

As part of my masters thesis i am 'Examining the Reliability of Markov Chains and The Kalman Filter as Stock Market Forecasters'. I will be using the daily returns from the s&p500 over a 5 year ...
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### Eurpean call option is a convex function of the strike price - proof

I need to show that the price of a plain European call option is a convex function of the strike E of the option i.e. show that $\frac{\partial^2 C}{\partial E ^2} \geq 0$
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### Exam FM question. Bonds with loss at the last moment.

I was working on the following problem and the answer that was given to me looks a little shady and I wanted someone to confirm my thoughts. As of 12/31/2005, an insurance company has a known ...
Suppose I have a portfolio composed by $n$ assets and fixed total size, with stochastic returns. I'm looking for a result stating that as $n$ increases the variance (or any other measure of riskiness) ...
I have a following setup: Let $c\in{\Bbb R}$, $R^2\in [0,1]$ and $\Psi,\varepsilon_1,\varepsilon_2,\ldots$ independent random variables on a probability space $(\Omega,{\cal A},{\Bbb P})$. Define the ...