1.

Record Nr.

UNINA9910155240903321

Autore

Primbs James A.

Titolo

A factor model approach to derivative pricing / / James A. Primbs, California State University, Fullerton, USA

Pubbl/distr/stampa

Boca Raton, Florida : , : CRC Press, , [2014]

©2014

ISBN

1-4987-6335-9

1-315-38029-3

1-4987-6333-2

Edizione

[1st ed.]

Descrizione fisica

1 online resource (294 pages) : illustrations

Disciplina

332.6457

Soggetti

Derivative securities - Prices

Derivative securities - Mathematical models

Assets (Accounting)

Lingua di pubblicazione

Inglese

Formato

Materiale a stampa

Livello bibliografico

Monografia

Note generali

"A Chapman & Hall book"--title page.

Nota di bibliografia

Includes bibliographical references and index.

Nota di contenuto

chapter 1. Building blocks and stochastic differential equation models -- chapter 2. Ito's Lemma -- chapter 3. Stochastic differential equations -- chapter 4. The factor model approach to arbitrage pricing -- chapter 5. Constructing a factor model pricing framework -- chapter 6. Equity derivatives -- chapter 7. Interest rate and credit derivatives -- chapter 8. Hedging -- chapter 9. Computation of solutions -- chapter 10. The road to risk neutrality.

Sommario/riassunto

Written in a highly accessible style, A Factor Model Approach to Derivative Pricing lays a clear and structured foundation for the pricing of derivative securities based upon simple factor model related absence of arbitrage ideas. This unique and unifying approach provides for a broad treatment of topics and models, including equity, interest-rate, and credit derivatives, as well as hedging and tree-based computational methods, but without reliance on the heavy prerequisites that often accompany such topics.  Key features   A single fundamental absence of arbitrage relationship based on factor models is used to motivate all the results in the book   A structured three-step procedure is used to guide the derivation of absence of arbitrage



equations and illuminate core underlying concepts    Brownian motion and Poisson process driven models are treated together, allowing for a broad and cohesive presentation of topics   The final chapter provides a new approach to risk neutral pricing that introduces the topic as a seamless and natural extension of the factor model approach   Whether being used as text for an intermediate level course in derivatives, or by researchers and practitioners who are seeking a better understanding of the fundamental ideas that underlie derivative pricing, readers will appreciate the book's ability to unify many disparate topics and models under a single conceptual theme.  James A Primbs is an Associate Professor of Finance at the Mihaylo College of Business and Economics at California State University, Fullerton.