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Q3 2014 Fact Sheet
Q3 2014 Fact Sheet

"Leverage Effect" a Leverage Effect?
"Leverage Effect" a Leverage Effect?

CONSTRUCTION OF EQUIVALENT MARTINGALE MEASURES
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Constructing Robust Affinity Graphs for Spectral Clustering

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... * use tree-manip to create a new tree, which keeps the odd-valued leaves of the original tree within the same tree structure, but removes even valued leaves B is a tree of A. Note that this is pretty much the tree equivalent of filter (keep-odd-leaves my-tree) => (1 (3 (5))) (keep-odd-leaves (list 1 ...
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Financial Intermediary Leverage and Value-at-Risk

... decides on the total size of its balance sheet - its total assets A - by taking on debt as necessary. The debt financing decision involves both the face value of debt D̄, as well as the market value of debt D. The repurchase price D̄ in the repo contract can be interpreted as the face value of the d ...
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Free-Cash-Flows-Based Valuation Models

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Lattice model (finance)



For other meanings, see lattice model (disambiguation)In finance, a lattice model [1] is a technique applied to the valuation of derivatives, where, because of path dependence in the payoff, 1) a discretized model is required and 2) Monte Carlo methods fail to account for optimal decisions to terminate the derivative by early exercise. For equity options, a typical example would be pricing an American option, where a decision as to option exercise is required at ""all"" times (any time) before and including maturity. A continuous model, on the other hand, such as Black Scholes, would only allow for the valuation of European options, where exercise is on the option's maturity date. For interest rate derivatives lattices are additionally useful in that they address many of the issues encountered with continuous models, such as pull to par.
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