Yahoo-Tumblr acquisition – How did the math work out?I think there are multiple methods at work here: a) Traffic Integration - What is Tumblr’s Traffic worth to Yahoo? What can Yahoo sell to these customers or sell these customers for? Over the next 5 years how much revenue would this traffic add to Yahoo’s bottom line? Read the [...]
Value at Risk – Calculating Portfolio VaR for multiple securities with & without VCV Matrix .In an earlier VCV Matrix post we had presented the theoretical proof of how the portfolio VaR obtained using the short cut weighted average return method produces the same result as would have been obtained if a detailed Variance Covariance [...]
Nate Silver – Signal vs Noise. Book review Overconfidence regarding our prediction skills often leads to worse predictions in situations where there is a high level of uncertainty surrounding an event. In the book by Nate Silver “The signal and the noise – why so many predictions fail but some don’t”, uncertainty is represented by the [...]
Table H Recently a visitor to FinanceTrainingCourse.com, who had seen our basic introductory course on developing commutation functions, requested us to recreate the commutation tables used by the IRS in the US, Table H. Table H contains commutations factors, at various interest rates, that are used in the valuation of annuities, life estates, and remainders.The tables contain [...]
A key element in the construction of the Black Derman Toy interest rate model is the setting up and running of EXCEL’s Solver function. The Solver functionality links various parts of the model together, the inputs- initial zero curve rates and their volatilities, the calculation cells – price lattices and short rate tree, and the [...]
The Black Derman Toy (BDT) model is a one-factor, no-arbitrage interest rate model. One-factor in that the entire term structure of interest rates can be inferred with reference to the process underlying the short rates derived. No-arbitrage in that th...
475. North Martingale Road, Schaumburg, IL. It’s the address – etched deep inside my memory. For eleven years as I registered for actuarial exams, took them, anticipated results and wrote to the Society of Actuaries (SOA), the snail mail address that I wrote down hundreds of times across that one decade was: 475 North [...]
Everywhere I look, I see old couples.I guess as a 42 year old, the young no longer catch me eyes (except when they decide to go walkabout without adult supervision)) . I love teaching them and corrupting their bright fresh minds, but it’s the 80 year old holding hands as they board aircrafts and sit [...]
Everything you wanted to ask about startup failure but were afraid to ask You were wondering what the fuss is all about? After all its just a book? So what if its on the iPad? Why does that make Reboot special? We put together a special section answering common questions around Reboot that have been asked. [...]
Enterprise Risk Management – Chicago Symposium – Highlights.Day One – ERM Pre Seminar – Forecasting Extreme Events Professor Guntram is really upset at Nassim Taleb. Nassim’s logic has never been perfect but he speaks from his heart as a practitioner. I can relate to the challenges he raises as a practitioner and I loved [...]