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by OGerritse
February 29th, 2012, 5:22 pm
Forum: Technical Forum
Topic: stripping caplet volatilities in presence of negative forward rates
Replies: 7
Views: 45870

stripping caplet volatilities in presence of negative forward rates

<t>Hi,Sorry for the bump but I have the same problem and after reading this post I can't figure it out yet.So the problem is: I'm trying to use the Black '76 formula to construct prices of at-the-money caps with implied vols but there are a few negative forward rates in the input data. The input dat...