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107 Example Questions (12 closed)

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added by Shane May 25 '10 at 21:02

This is the kind of question that this site should serve well: specific question with a definitive answer and of general interest. – Shane May 30 '10 at 14:28

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added by Jaydles, edited by WikiSpeedia hang-around Jul 11 '10 at 20:07

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added by Jaydles, edited by WikiSpeedia hang-around Jul 11 '10 at 20:17

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added by Jaydles May 29 '10 at 15:40

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added by Patrick May 31 '10 at 18:17

This question doesn't make really make sense. It's basically "how do you estimate the present when the future is not known?" – cletus Jun 1 '10 at 1:55

Implied vol is the vol that banks imply for the future when they are pricing options. Of course no one can predict the future so usually it is based on some component of historical vol. The question is really about what methods banks use to come up with that forward-looking volatility. There are various way of doing this, so I think this question makes sense.... – Patrick Jun 1 '10 at 8:21

@cletus, I don't think I quite agree. Implied vol represents what todays market participants think future volatility will be. So it's more like saying, "What factors do market participants generally incorporate to form an assumption about what future volatility will likely be?" And as @Patrick suggests, a good answer would probably include historical vol, plus known future events (earnings, court verdicts/agency rulings, etc.) – Jaydles Jun 1 '10 at 13:33

"Implied vol is the vol that banks imply for the future when they are pricing options. Of course no one can predict the future so usually it is based on some component of historical vol." That's rubbish. The example question is a great example of question a completely misguided person would ask. – quant_dev Jun 12 '10 at 10:07

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added by Patrick May 31 '10 at 18:28

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added by Patrick May 31 '10 at 18:33

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added by Shane Jun 1 '10 at 13:41

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added by Shane Jun 1 '10 at 15:23

closed as off topic by Joel Spolsky, Peter K., elliotb, James Webster, jbr Jul 4 '10 at 4:50

This question does not relate to the topic of the proposal.
It was closed as part of an automated migration of off-topic to close votes on September 29, 2011.

	Way too specific. – Shane Jun 1 '10 at 20:30
	agree with Shane... need to avoid data requests weakly shrouded as questions. – JD Long Jun 2 '10 at 14:27

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added by Dani Jun 17 '10 at 18:09

Valid question, but better if the "my" is removed to make it more generic. – ciczan Jun 30 '10 at 13:35

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added by Tugga Jun 24 '10 at 12:53

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added by Noli Jun 25 '10 at 20:02

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added by Jonathan Shore, edited by WikiSpeedia hang-around Jul 11 '10 at 20:19

This is relevant, although not entirely in the form of a question... – Shane Jul 6 '10 at 20:04

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added by Jonathan Shore Jul 6 '10 at 20:06

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added by pteetor Jul 8 '10 at 15:30

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added by pteetor Jul 9 '10 at 11:03

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added by Andrew Bolster Jul 9 '10 at 22:10

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added by dsm Jul 14 '10 at 7:33

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added by Shane May 25 '10 at 20:24

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added by Shane May 25 '10 at 20:25

	Questions about alternative investments should be included, IMHO... – Shane Jun 1 '10 at 13:24
	@Shane: Yes, but this is a question about law, not finance. From this crowd, it's likely to generate spurious response and some flaming. :-) – pteetor Jul 8 '10 at 15:03
	@pteetor: That's reasonable. I don't think that this is a "great" off-topic example for the site (in the scheme of things), although it might not be a good example either. I'm going to delete the question. :) – Shane Jul 8 '10 at 15:05

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added by coderguy123 May 27 '10 at 2:49

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added by Jaydles May 27 '10 at 3:38

	I vote yes, but again, not sure if this is too basic for experts. If you don't know put, call, straddle, strangle, condor, this probably isn't the site for you. – Michael Pryor May 27 '10 at 17:18
	I agree with @Michael. "Covered put" is a pretty basic term. – cletus May 27 '10 at 23:06
	I don't think I agree that all questions have to be expert. There just have to be enough expert questions to keep the experts there. Separately, I'd wager that most finance pros couldn't answer this one completely (there are three ways), including most prop options traders, because they never have to think about it. – Jaydles May 27 '10 at 23:50

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added by Troggy May 27 '10 at 5:16

closed as off topic by Shane, CodeKiwi, bromfiets, Graviton, ciczan Jun 30 '10 at 13:37

This question does not relate to the topic of the proposal.
It was closed as part of an automated migration of off-topic to close votes on September 29, 2011.

Or what is the cheapest broker is regards to trade fees. – Troggy May 27 '10 at 5:17

Will probably change with time, though. – Gnoupi May 27 '10 at 6:08

Also, opens up the door for brokers to use the site for advertising... – Shane Jun 1 '10 at 13:25

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added by Jaydles May 27 '10 at 14:43

This question falls into the same problem as the original straddle question: it might be too basic. – Shane May 30 '10 at 14:38

I'm a little on the fence with the idea of "too basic" insert straddle pun here Spolsky had the idea with stackoverflow that even basic questions, as long as they were on topic, should be allowed. I lean that way too. This is sort of the "how do you move the turtle in Logo?" question of finance. – JD Long Jun 2 '10 at 14:20

@JD I'm sympathetic, although I was thinking more of the MathOverflow model, which is really the only stackexchange site to succeed. Having both experts and non-experts is a good thing; it's just a difficult balancing act if you don't want to alienate anyone. – Shane Jun 2 '10 at 14:48

@Robert: I know; that's why I'm questioning whether these questions are too basic. That would be one way to manage this site as well. Or, we could be more forgiving of basic questions. I'm just commenting on what has seemed to work in the SE world so far... – Shane Jun 2 '10 at 17:46

@Robert: Of course SO is the most successful, but I think it's unrealistic to expect other sites to have the same level of initial success, both because of the status of Joel/Jeff and because programmers are already very accustomed to these kinds of sites. The question (which can't readily be answered) is whether a high-specialized StackExchange site is more likely to succeed (based on SE 1.0 experience). Regardless, this decision is up to the community in the discussion phase. It would seem thus far that the consensus is to allow general and basic questions. – Shane Jun 2 '10 at 18:07

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added by cletus May 27 '10 at 23:24

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added by Jaydles, edited by WikiSpeedia hang-around Jul 11 '10 at 20:22

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added by Jaydles May 28 '10 at 3:46

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added by Jaydles May 29 '10 at 18:05

This seems a bit too "personal finance" to me. – cletus May 30 '10 at 13:22

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added by Jaydles May 30 '10 at 2:15

	This and a few other questions seem to be about market microstructure... is this a relevant topic for this site? – James Webster Jul 3 '10 at 13:22
	Absolutely...market microstructure is a relevant topic. – Shane Jul 3 '10 at 15:16

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added by Good Person May 30 '10 at 16:23

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added by Shane May 31 '10 at 16:05

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added by Patrick May 31 '10 at 18:19

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added by Patrick May 31 '10 at 18:22

	You mean, S&P and Dow Jones, for instance? – Shane Jun 1 '10 at 14:50
	Correct but there are lots of companies creating more or less complicated indices for general use or specific clients charging a licensing fee in return for providing the index. Before I worked in banking I often wondered how this works and specifically who creates and calculates indices. I suppose the quants already know so maybe more of a newbie question... – Patrick Jun 2 '10 at 23:09

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added by The Lazy DBA Jun 17 '10 at 2:18

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added by Tugga, edited by WikiSpeedia hang-around Jul 11 '10 at 20:18

	this is too simple – bromfiets Jun 26 '10 at 21:15
	@bromfiets When a programmer starts developing software for financial industry, these are kind of questions he/she has. – Tugga Jun 27 '10 at 5:27
	@Tugga. You are right correct. I have seen the question "What's the difference between a straddle and a strangle" which was rated as a good off-topic example so I thought the call/put question should be off topic too. I find these kind of questions too simple to attract the sort of types who participate in the forums at willmot.com. – bromfiets Jun 27 '10 at 12:29