Monday, November 16, 2015
Tuesday, August 5, 2014
Saturday, April 13, 2013
Are Capitalism and Democracy Failing Us?, Raghuram Rajan
Good info on Corporate Finance & Valuation.
http://aswathdamodaran.blogspot.com/
www.damodaran.com
Friday, January 4, 2013
Mortgage Merry-Go-Round
Mortgage Merry-Go-Round
In the past five years, he has devised a series of trades to take advantage. In the third quarter of 2008, anticipating government intervention in the mortgage market, he bought agency bonds that were backed by 30-year mortgages while simultaneously selling U.S. Treasury securities. After agency mortgage prices had risen, he closed the trade, shorted 30-year mortgage bonds and bought 15-year bonds. At the end of 2011, he switched to buying 30-year mortgage bonds in anticipation of further government buying.-----------------------------------------------------------
Need to give much more explanation for the above statement.
----------------------------------------------------------
Beyond his Fed watch, Narula has geared up his algorithms to anticipate what homeowners will -- and won’t -- do. Because housing values have fallen and banks are stingy with new loans, many haven’t been able to respond to low interest rates by refinancing, even with new government programs.
“Betting that homeowners will not be refinancing has been a winning wager,” Narula says. Pine River’s Steve Kuhn churns through massive amounts of data to determine which bonds to bet on.
Monday, August 13, 2012
Options , Call & Puts.
At a High Level , There are 3 financial products -
Owner Ship like Stocks
Loaner Ship like Bonds
Insurance like Derivatives (Options,Futures & Swaps)
By applying different permutations and combinations to the above financial products we arrive with new Financial Products.
Key Terms:
Options : Price Movement
Call(s) : Right to Buy Underlying Instrument at a specific price.
Put(s) : Right to Sell Underlying Instrument at a specific price.
Long : Buyer (Pays Premium therefore has the Right but not Obligation).
Short : Seller (Receives Premimum therefore Obligation to do)
There are 4 Positions.
Long the call option
In this case you are buying a contract that gives you the right to purchase an underlying on or before a future date at a predetermined ‘strike ’ price. You give up some money so that you can hold this right.
Short the call option
In this case you are the party that sells a contract which gives someone else the right to purchase (from you) an underlying on or before a future date at the strike price.
Long the put option
In this case you are buying a contract that gives you the right, but not the obligation, to sell an underlying on or before a future date at the strike price.
Short the put option
In this case you are selling to someone else a contract that gives them the right, but not the obligation, to sell an underlying (to you) on or before a future date at the strike price.
Call Option is like a Medical Insurance. If you expect Bullish or price goes above the strike price then go for Call Option. Example: As a person we pay the Premium to Insurance Company to transfer our risk to Insurance company there by If your cost goes above certain price then Insurance company pays the difference.
You Buy Insurance Premium (Insurer)
Put Option is like a Car Insurance. If you expect Bearish or price goes below the strike price then go for Put Option.
Example: As a person we pay the Premium to Insurance Company to transfer our risk to Insurance company there by If your car value goes below certain price then Insurance company pays the difference.
You buy Insurance Premium (Individual User)
You Sell Insurance Premium (Insurer) - Put Writer
Owner Ship like Stocks
Loaner Ship like Bonds
Insurance like Derivatives (Options,Futures & Swaps)
By applying different permutations and combinations to the above financial products we arrive with new Financial Products.
Key Terms:
Options : Price Movement
Call(s) : Right to Buy Underlying Instrument at a specific price.
Put(s) : Right to Sell Underlying Instrument at a specific price.
Long : Buyer (Pays Premium therefore has the Right but not Obligation).
Short : Seller (Receives Premimum therefore Obligation to do)
There are 4 Positions.
Long the call option
In this case you are buying a contract that gives you the right to purchase an underlying on or before a future date at a predetermined ‘strike ’ price. You give up some money so that you can hold this right.
Short the call option
In this case you are the party that sells a contract which gives someone else the right to purchase (from you) an underlying on or before a future date at the strike price.
Long the put option
In this case you are buying a contract that gives you the right, but not the obligation, to sell an underlying on or before a future date at the strike price.
Short the put option
In this case you are selling to someone else a contract that gives them the right, but not the obligation, to sell an underlying (to you) on or before a future date at the strike price.
Call Option is like a Medical Insurance. If you expect Bullish or price goes above the strike price then go for Call Option. Example: As a person we pay the Premium to Insurance Company to transfer our risk to Insurance company there by If your cost goes above certain price then Insurance company pays the difference.
You Buy Insurance Premium (Insurer)
You Sell Insurance Premium (Insurer) - Call Writer
Put Option is like a Car Insurance. If you expect Bearish or price goes below the strike price then go for Put Option.
Example: As a person we pay the Premium to Insurance Company to transfer our risk to Insurance company there by If your car value goes below certain price then Insurance company pays the difference.
You buy Insurance Premium (Individual User)
You Sell Insurance Premium (Insurer) - Put Writer
Wednesday, July 11, 2012
Learning Websites about Economics and Finance
About Economics - Podcasts
http://www.voxeu.org/
http://press.princeton.edu/
Monetary Policy and Fed Reserve
http://www.youtube.com/user/FedReserveBoard
------------------------
UCBerkeley Economics by Professor Kenneth Train
http://www.youtube.com/watch?v=T7yC-5IDhKM&feature=BFa&list=PLF7D78F06BEC0901C
------------------------------
Yale Financial Markets (2011) with Robert Shiller
http://www.youtube.com/course?list=EC8FB14A2200B87185
------------------------------
Futures and Options by Professor Colin Carter
http://www.youtube.com/course?list=ECF23D8A8BE44E6EA7
----------------------------------
Very good blog about Macro Economic Theory.
http://www.themoneyillusion.com/?m=200902
-------------------------------
Good Book about Macor Economics.
Economics of Money, Banking, and Financial Markets Business School Edition plus MyEconLab Student Access Kit, 2/E
-----------------------------------------
http://www.voxeu.org/
http://press.princeton.edu/
Monetary Policy and Fed Reserve
http://www.youtube.com/user/FedReserveBoard
------------------------
UCBerkeley Economics by Professor Kenneth Train
http://www.youtube.com/watch?v=T7yC-5IDhKM&feature=BFa&list=PLF7D78F06BEC0901C
------------------------------
Yale Financial Markets (2011) with Robert Shiller
http://www.youtube.com/course?list=EC8FB14A2200B87185
------------------------------
Futures and Options by Professor Colin Carter
http://www.youtube.com/course?list=ECF23D8A8BE44E6EA7
----------------------------------
Very good blog about Macro Economic Theory.
http://www.themoneyillusion.com/?m=200902
-------------------------------
Good Book about Macor Economics.
Economics of Money, Banking, and Financial Markets Business School Edition plus MyEconLab Student Access Kit, 2/E
-----------------------------------------
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