Book Image

Python for Finance

By : Yuxing Yan
Book Image

Python for Finance

By: Yuxing Yan

Overview of this book

A hands-on guide with easy-to-follow examples to help you learn about option theory, quantitative finance, financial modeling, and time series using Python. Python for Finance is perfect for graduate students, practitioners, and application developers who wish to learn how to utilize Python to handle their financial needs. Basic knowledge of Python will be helpful but knowledge of programming is necessary.
Table of Contents (14 chapters)
13
Index

Performing array operations with +, -, *, /


Plus and minus for an array would have their normal meaning. However, multiplication and division have quite different definitions. Using multiplication as an example, A × B arrays could have two meanings: either item by item (A and B should have the same dimensions, that is, both are n by m) or matrix multiplication (the second dimension of A should be the same as the first dimension of B, that is, A is n by m while B is m by p ).

Performing plus and minus operations

When adding or subtracting two arrays, they must have the same dimensions, that is, both are n by m. If they have different dimensions, we will get an error message. The following example shows the summation of two cash flow arrays:

>>>cashFlows_1=np.array([-100,50,20])
>>>cashFlows_2=np.array([-80,100,120])
>>>cashFlows_1 + cashFlows_2
>>>array([-180, 150, 140])

Performing a matrix multiplication operation

For matrix multiplication, matrices A and...