1. Download daily price from Yahoo! Finance for DELL. Estimate daily returns and convert them into monthly returns. Assume its monthly returns follow a normal distribution. Draw a graph with the mean and standard deviation from the previous monthly returns.
2. Debug the following program:
import scipy as sp S0 = 9.15 ;T =1;n_steps=10;mu =0.15;sigma = 0.2 n_simulation = 10 dt =T/n_steps S = sp.zeros([n_steps], dtype=float) x = range(0, int(n_steps), 1) for j in range(0, n_simulation): S[0]= S0 for i in x[:-1]: e=sp.random.normal() S[i+1]=S[i,j]+S[i]*(mu-0.5*pow(sigma,2))*dt+sigma*S[i]*sp.sqrt(dt)*e; plot(x, S) figtext(0.2,0.8,'S0='+str(S0)+',mu='+str(mu)+',sigma='+str(sigma)) figtext(0.2,0.76,'T='+str(T)+', steps='+str(int(n_steps))) title('Stock price (number of simulations = %d ' % n_simulation +')') xlabel('Total number of steps ='+str(n_steps))) ylabel('stock price') show()
3. Write a Python program to price an Asian average price put based on the...