Author: Jish Bhattacharya

Implied Volatility Calculator

The Black-Scholes model can be used to estimate implied volatility. Implied Volatility can be estimated using  spot price, strike price, asset price, risk-free rate, time to maturity, and dividend yield. To achieve this, given an actual option value, you have to iterate to find the volatility solution. There are various techniques available; however we will use […]

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Exponential Moving Average in Excel

A primer on EMA: The moving average method is a commonly used technical analysis indicator. All moving averages typically use a historical data series and the current price in the calculation. An Exponential Moving Average or EMA assigns a weighting factor to each value in the data series based on its age. The most recent data gets the greatest […]

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Calculate MACD in Excel

Moving Average Convergence Divergence (MACD) is a popular trend-following momentum indicator. The MACD turns two trend-following indicators, moving averages, into a momentum oscillator by subtracting the longer moving average from the shorter moving average. MACD is calculated by taking difference between 12 day Exponential Moving Average (EMA) and 26 day EMA. A positive MACD means the 12-period EMA […]

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Adword Budget Optimizer

How much should my AdWords budget be? This is a very common and an important question for advertisers. It is also one that doesn’t have a straightforward answer. If AdWords is profitable for you, then by all means your budget should be as high as possible. If AdWords is not profitable for you, then your budget […]

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Simple Revenue Model Simulation

Build a Revenue Model through Simulation Revenue prediction and forecasts are typically done to be too right. They create a false sense of precision that ultimately falls short and does a disservice to managers who need accurate forecasts for planning. Even meteorologists equipped with voluminous historical data and supercomputers cannot get it right all the […]

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Simulating Call Option Variance Reduction

A common shortcoming of standard Monte Carlo Simulation is the required computing resources and time. MC simulation typically has an error variance of σ2/n.To achieve a desired accuracy in a crude MC simulation, the sampling is conducted with a larger value of n. But this approach decreases the efficiency of the simulation. In this post, I will explore few […]

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Binomial Option Pricing Excel

A Primer on Binomial Option Pricing A binomial tree represents the different possible paths a stock price can follow over time.To define a binomial tree model, a basic period length is established (such as 1 month). If the price of a stock is known at the beginning of a period, the price at the beginning of […]

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