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Present Value Methods, Yields, and Traditional Risk Measures

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Derivatives and Internal Models

Part of the book series: Finance and Capital Markets Series ((FCMS))

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Abstract

Present value methods determine the value of a financial instrument by discounting all future cash flows resulting from the instrument. Applying this method requires few assumptions. Only Assumptions 1, 2, 3, 4, and 5 from Chapter 4 are necessary.

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© 2009 Hans-Peter Deutsch

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Deutsch, HP. (2009). Present Value Methods, Yields, and Traditional Risk Measures. In: Derivatives and Internal Models. Finance and Capital Markets Series. Palgrave Macmillan, London. https://doi.org/10.1057/9780230234758_5

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