APGP Interest Rate Question

This is a question from TJC Promotion 2017 Question 10. Thank you Mr. Wee for sharing. Mr. Scrimp started a savings account which pays compound interest at a rate of r% per year on the last day [...]

How far has modern technology made it unnecessary for individuals to possess mathematical skills?

How far has modern technology made it unnecessary for individuals to possess mathematical skills? Argument 1: Modern technology has provided us with tools that automate mathematical operations [...]

Financial Engineering (I)

Before attempting to read what we have here, students should revise their basic probability and linear algebra first. Financial Engineering (I) #1 – Overview Financial Engineering (I) #2 [...]

Geometric Brownian Motion

This is really important for anyone interested in Finance Modelling. As what the movie Wolf on Wall Street says: They are referring to a geometric brownian motion. Firstly, we will begin with the [...]

Introduction to Brownian Motion

Lets look at brownian motion now. And yes, its the same as what our high school teachers taught about the particles moving in random motion. Here, we attempt to give it a proper structure and [...]

Review of Basic Probability

So I understand that I lost many readers for the Sampling uploads.It is a bit difficult to the intensive use of notations and also the need for statistics knowledge. So here I’ll review a [...]

Introduction to Martingales

This is a rather important topics for anyone interested in doing Finance. Lets look at their definition first. A Martingale is a random process with respect to the information filtration and the [...]

Multivariate Distributions

Let be an n-dimensional vector of random variables. For all , the joint cumulative distribution function of X satisfies Clearly it is straightforward to generalise the previous definition to join [...]

Financial Engineering (I) #2 – Introduction to No Arbitrage

Consider the following contract 1. Pay the price p at t=0. 2. Receive at time t=k, k = 1, …, T *Cash flow can be negative So what does the above contract mean? One pays a price p at time in [...]

Financial Engineering (I) #1 – Overview

As some of you observe, I’ve been posting a handful of undergraduate and postgraduate materials or courses here. Some close students also asked me to share more on financial engineering. So [...]

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