Learning Curve

Suppose you own XYZ Company bonds.

PROBLEM: The goal of hedging is to offset the risk inherent in a perhaps illiquid position by taking positions in liquid instruments.

What is exposure? It is one of the buzzwords of modern risk management, but in fact the word is used to describe a number of different variables.

The analysis and management of options requires that one be able to digest a certain Greek alphabet soup.

If the Black-Scholes model and its extensions were the discoveries of the 70s and 80s, then value-at-risk models are the darlings of the 90s.

In June, the Financial Accounting Standards Board issued its Statement of Financial Accounting Standards number 133, titled accounting for derivative instruments and hedging activities.

A convertible grants the bondholder the right to convert the bond into a predetermined number of shares of common stock, i.e. the bondholder is long a call on the issuer's stock.

A commonly-asked question in financial modeling refers to the minimum number of stochastic factors that must be included in the model in order to properly capture the price and risk behavior of financial instruments.

Energy markets are dramatically different from financial markets.

In a credit contingent contract, payment is dependent on the occurrence of a certain credit event.

The binomial weave is a new technique for modeling the term structure of interest rates.

The Securities (Disclosure of Interests) Ordinance currently requires disclosure of 'interests' in shares in Hong Kong-listed companies by directors of the relevant company and by any other person with an interest representing 10% or more of any class of the company's issued share capital.