Options are covered under the online course on Impact Bonds. First published as part of Impact Bonds online course, this note shares a brief overview of the global options market. Options are derivative instruments. Derivatives are financial instruments whose value is based on an underlying asset. This asset could be a tradeable asset like listed shares of a company or derivatives
Recent collapse of banks in the US especially Silicon Valley Bank (SVB) speaks about the fundamental problem inherent in our economic system- herd mentality. As pundits’ point out the collapse of SVB through an asset liability mismanagement looking at the duration of portfolio assets in a rising interest rate scenario, the behavioral of depositors leading to the bank run must
Bootstrapping: Calculation of theoretical spot rate curve from a par yield curve This educational publication is the special valuation series on fixed income securities. Its mandatory to read the Understanding Term Structure of Interest Rates posted under Insights here before reading Bootstrapping: Calculation of theoretical spot rate curve from a par yield curve. There are multiple ways in which a
In the long run, the output of an economy depends upon the level of technology, capital, and labor. Ignoring other factors of production, the production function is best defined by the Cobb Douglas equation = A KαL1-α. Although the Cobb Douglas is based on the analysis for the United States, the analysis could be extended for other countries. Capital
Designed as a thought leader in understanding the term structure of interest rates, this publication is an excellent educative read for insightful academic knowledge about factors impacting the term structure of interest rates. Structured to enhance the pedagogy of fixed income valuation course on The middle Road, Term Structure of Interest Rates shares a formative understanding on this subject.
“A market where there are large number of rational, profit maximisers actively competing, with each other trying to predict future market values of individuals securities and where important current information is almost available to all participants” Eugene Fama on Efficient Markets The theory of random walk led to the efficient market hypothesis. Eugene Fama, the father of modern mathematical finance,
Originally posted as part of the Stabilization Macroeconomics series, the academic focussed publication sets the tone for the upcoming Macroeconomic Online Course on Stabilization. The series focuses more on the role of the Central Banks in driving monetary, fiscal, and macroeconomic policies of the government. The course begins with a look at Central Banks as enablers, its monetary focus on
Understanding Alternative Investments – A look at Standard Normal Alternatives or alternative investments are the one of the categories of asset classes, these types of investments include hedge funds, private equity, or venture capital or include the use of leverage or derivatives as part of the investment style. Example long-short style of investing in equities used by hedge funds or
The World Bank came out with a $150 million Wildlife Conservation Bond (WCB), the first of its kind globally. an impact-focused Sustainable Development Bond to protect black rhinos in South Africa and support local communities. This intense publication discusses the Wildlife Conservation Bond issued by the World Bank. An in-depth analysis of the bond discusses various facets of the new financial innovative
# What Are Impact Bonds ? Impact Bonds is an intense read on these financial instruments based on the online educational tutorial published by The middle Road on this subject. A derivative of many research papers, this read is a precursor to the upcoming online course on impact bonds. The report aims to share a brief on the evolution of
