Book Image

Python for Finance - Second Edition

By : Yuxing Yan
5 (1)
Book Image

Python for Finance - Second Edition

5 (1)
By: Yuxing Yan

Overview of this book

This book uses Python as its computational tool. Since Python is free, any school or organization can download and use it. This book is organized according to various finance subjects. In other words, the first edition focuses more on Python, while the second edition is truly trying to apply Python to finance. The book starts by explaining topics exclusively related to Python. Then we deal with critical parts of Python, explaining concepts such as time value of money stock and bond evaluations, capital asset pricing model, multi-factor models, time series analysis, portfolio theory, options and futures. This book will help us to learn or review the basics of quantitative finance and apply Python to solve various problems, such as estimating IBM’s market risk, running a Fama-French 3-factor, 5-factor, or Fama-French-Carhart 4 factor model, estimating the VaR of a 5-stock portfolio, estimating the optimal portfolio, and constructing the efficient frontier for a 20-stock portfolio with real-world stock, and with Monte Carlo Simulation. Later, we will also learn how to replicate the famous Black-Scholes-Merton option model and how to price exotic options such as the average price call option.
Table of Contents (23 chapters)
Python for Finance Second Edition
Credits
About the Author
About the Reviewers
www.PacktPub.com
Customer Feedback
Preface
Index

Comparison between two social policies – basic income and basic job


This example is borrowed from Stucchhio (2013). Over the development of the past several decades, the wealth of each nation is continuously commutative. This is especially true for the developed countries. One of the basic arguments supporting equity is that each citizen should have their basic standard of living. Based on this argument, many countries offer huge benefits to their citizens, such as universal healthcare, free education, and the like. One policy suggestion is basic income, under which each citizen receives a basic income annually with no strings attached. For example, if we assume that the basic hourly rate is $7.50, 40 hours per week and 50 weeks per year, then the basic income should be $15,000. Zhong (2017) reports that India is considering fighting poverty with a universal basic income plan. The obvious advantage is that the administration cost will be quite small. In addition, it is less likely that corruption...