For a given three-day period, the interest rates are 4.0, 4.1, and 4.0 percent. What is the yield volatility over this period? A) 0.0247. B) 0.356. C) 0.0349. D) 0.00356.
C and this question took me more time than it should have.
A
.idiot
Formula?
is that comment for me florinpop? If anyone at the end of this has a short cut please let me know. It seems like it should be really simple.
is this standard deviation of the returns in simpler english?.
florinpop Wrote: ------------------------------------------------------- > .idiot You called me? I was in my sleep! I am the only one with that name left.
LanceTX Wrote: ------------------------------------------------------- > Formula? var = SUMMATION[(Xt - X bar)/ (T - 1)] remember we need STD. Try it now…
Gmof dinesh I was calling myself stupid cause I can’t decide on an answer dsylexic I think it should be the standard deviation but is it a sample or pop?
florinpop Wrote: ------------------------------------------------------- I think it should be the standard > deviation but is it a sample or pop? ok, I can give you this. Consider this as the sample.
No worries. That’s what my wife calls me all the time. I thought maybe she’s on AF too.
What a co!! it’s my nick, so was wondering how did florinpop knew about my nick.
dinesh I don’t seem to get the ans can you please post it so i can shoot myself?
Question 5 - #9654 For a given three-day period, the interest rates are 4.0, 4.1, and 4.0 percent. What is the yield volatility over this period? A) 0.0577. B) 0.0471. C) 0.0349. D) 0.0000. Your answer: D was incorrect. The correct answer was C) 0.0349. The yield volatility is the standard deviation of the natural logarithms of the two ratios (4.1/4.0) and (4.0/4.1) which are 0.0247 and 0.0247 respectively. Since the mean of these two numbers is zero, the standard deviation is simply {[(0.0247)2 +(-0.0247)2]/(2-1)}0.5=0.0349.
well I wouldn’t have got the right ans in a million years
Dinesh. You like quant. Is there a way to do this on the calculator using the stat funtions to get the right answer?
Yes GMofDen - But I use TI BA2 Plus (Professional) Keystrokes 2nd DATA X01 = 0.0247 Next Next (to skip the Y01) X02 = -0.0247 CE/C 2nd STAT Next Next Next The screen will show = Sx = 0.03493107
Awesome. I was putting in the ln of 4.1, then ln 4, then ln of 4.1 in the data screen and was getting the wrong answers using the process you highlighted above. THANKS that helps a ton!
well, i m idiot, hehe forgot to time sqrt 2, well, its C .0349