Statistical Methods in Finance 2018

Dec 17 - 20, 2018


Abstract

Challenges in derivatives valuations, risk and current developments in Emerging markets

by Vitthal Kulkarni

Derivatives contract valuations have come a long way from risk neutral valuation coming out of traditional pricing models to the fair valuations used in the books of account. After global financial crisis during 2007 - 2009, risk neutral valuations are adjusted for credit, funding, liquidity and other risks faced in the market place. This presentation will highlight fair value adjustments conducted by the market participants and the its importance to manage model risk.