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"Our tree is actually a tree of the short-term interest rate. The average direction in which the short-term interest rate moves depends on the level of the rate. When the rate is very high, that direction is downward; when the rate is very low, it is upward."
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Exlpore more Direction quotes
"It's hard to be happy when you are facing 120 to 140 degree temperatures and nothing seems to be moving in a direction that you think or they think or you've been told it's supposed to be moving in."
"I'm inspired by the poets, so I'm always going to give in that direction, rather than in any other. It's the making of me... and also the downfall of me."
"Mentoring is a brain to pick, an ear to listen, and a push in the right direction."
"If you don't know where you are going, you might wind up someplace else."
"I've done enough of this that I can tell early on if it's going in the wrong direction or not."
"The greatest thing in this world is not so much where we are, but in what direction we are moving."
"I truly, truly believe that I was going in that direction and all of a sudden fate took me and put me here. It's like something else has other plans for me."
Explore more quotes by John Hull
"Briefly speaking, our conclusion is that stochastic volatility does not make a huge difference as far as the pricing is concerned if you get the average volatility right. It makes a big difference as far as hedging is concerned."
"The problem with interest rates are that you are not modeling a single number, you are modeling a whole term structure, so it is a sort of different type of problem."
"Our research led on to other things, such as the fact that exchange rates are not lognormally distributed."
"The HoLee model was the first term structure model. I remember reading their paper soon after it was published and as it was fairly different from many of the other papers that I had read, I had to read it quite a few times. I realized that it was a really important paper."
"One important measurement issue concerns the fat tails problem that I mentioned earlier. VAR is concerned with extreme outcomes. If the tails of the probability distributions we are using are too thin, our VAR measures are likely to be too low."
"The real challenge was to model all the interest rates simultaneously, so you could value something that depended not only on the three-month interest rate, but on other interest rates as well."
"We concluded that you cannot rely on delta hedging alone. It sounds simplistic to say that now, but back then, this was the sort of thing people were only just beginning to realize."
"If each of your time steps is one week long, you are not modeling the stock price terribly well over a one-week time period, because you are saying that there are only two possible outcomes."
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