pnl for Dummies
$ Now you say $V_t$ could be the risky asset. Extremely perplexing. Edit the put up to make this crystal very clear. We could consider what's a PnL as soon as we understand what We've got invested in. $endgroup$Trader A has made some hefty PnL, meanwhile Trader B arrives out with nothing in the slightest degree and his skipped out on volatility through the investing day which he could've profited off of had he been constantly hedging in place of just at the time each day.
La PNL funciona a través de una serie de técnicas y herramientas que permiten a las personas identificar y modificar sus patrones de pensamiento y comportamiento. A continuación, se describen algunas de las técnicas más comunes utilizadas en la PNL.
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So the thought listed here is a trader who delta-hedges every moment, along with a trader who hedges every close of day at market shut, will the two have the similar expected income at choice expiry and only their PnL smoothness/variance will vary. Let us put this on the check.
So So how exactly does delta-hedging frequency just impact click here the smoothness and variance of PnL if we could Plainly see it affects PnL itself in this example?
As described I will not think a single system is a lot more specific, but a technique may be needed or advised by marketplace benchmarks or laws.
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