<t>Hi,I need to adjust my difference-in-means t-statistics for possible moving average effects using the Newey-West correction. However, I cannot get my head around how to do it, since I'm not using regressions and don't see where the standard errors would come from... Any help would be greatly appr...

<t>Hi guys,I wonder if any of you has the following paper by Vijay Bawa "Optimal Rules For Ordering Uncertain Prospects," Journal of Financial Economics, 1975, v2(1) as well as "Capital market equilibrium in a mean-lower partial moment framework" by Bawa and Lindenberg, Journal of Financial Economic...

Hi,This may seem like a totally dumb question but Is there a way to plot a beta function pdf in Excel? Is there a way to handle the integral calculation?Thanks.

Lepperbe,Yeah, I've figured that after having actually posted the question... Thanks!

<t>QuoteOriginally posted by: MMPThe probability calculation must be used to calculate the expected final value and then the expected return is derived from that. It is incorrect to calculate the expected return for each situation and then multiply by the probabilities to get the final expected retu...

Macca,I believe you have one 0.5 too many.If log returns, thenE[R] = 0.5*ln(CF2/CF0) + 0.5*(CF2/CF0)

The email link glitched in the previous post! email

I would greatly appreciate it if you could pencil me in. Thanks!leksandr_bihun@yahoo.com">email

Macca,How about computing the return this wayE[R] = 0.5*(sqrt(200/100)-1) + 0.5*(sqrt(150/100)-1)?

<t>Hi,Suppose you have a $100 invested that is expected to bring you either 200 or 150 in two years with equal probabilities.Does the situation seem likely, probabilistically, and how would you go about calculating the expected return?Thanks!P.S. Just a question I got asked and there are varying opi...

Anyone?

<t>Aaron,Thanks for the input! So, once we're out of the realm of investment grade, pricing of such forward contracts is tough, i.e. the replication and no-arbitrage arguments do not really hold and no two banks will come up with the same valuation. Or is the credit-risk adjustment an agreed upon pr...

<t>John,Just to clarify, all investment grade, collateralized forwards are discounted at the LIBOR, while the low-credit forwards are discounted at the cost of debt of the LOW-CREDIT corporation, right?The story of LTCM is definately an amazing one.David, do you have that paper? I haven't been able ...

John, thanks for clarification!

Hi! When pricing forward contracts using F(0) = S(0)e^rT, r is the risk-free rate. However, there is a risk that the counter party will default on their contract. How is that accounted for? Or are there other formulas used in practice?