Question
Suppose stock XYZ has a current price of $50. We model the daily innovation in the stock price by assuming that (absolute) daily price changes
Suppose stock XYZ has a current price of $50. We model the daily innovation in the stock price by assuming that (absolute) daily price changes are i.i.d. (independent and identically distributed), with each change S(t+1) S(t) having mean zero and standard deviation $0.60. Can you approximate the probability that the stock price will exceed $52 on August 23, 2021 (6 months from today)?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
The Concise Guide To Mergers Acquisitions And Divestitures Business Legal Finance Accounting Tax And Process Aspects
Authors: R. Brown
1st Edition
0230600786,0230608949
