Actuarial Outpost Should I memorize the lookback options formula?
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#11
07-05-2017, 04:07 PM
 Tetsuo Member SOA Join Date: Mar 2016 Posts: 330

yay thx!
#12
07-05-2017, 08:10 PM
 umich Member SOA AAA Join Date: Mar 2016 Location: Detroit, MI College: University of Michigan Alum Posts: 144

Quote:
 Originally Posted by stlcardinals001 Check out the Mahler Sample MFE Exam here: http://howardmahler.com/Teaching/MFE.html Click on 2017FinEconExam#1.pdf and look at #2
Thank you so much! You saved my life! I tried working on this problem without looking at the answer and got it right! The concept is fairly easy and the calculation is simple too if no B/S is involved. I highly encourage those who have no idea what lookback options are and are not planning to memorize the scary formulas posted in this thread, to learn the definition of lookback options and try one or two problems like this.
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#13
07-07-2017, 10:28 PM
 BelayMeMaybe Member SOA Join Date: Feb 2017 College: University of Louisville Alumni Posts: 33

Quote:
 Originally Posted by The Disreputable Dog IDK. If there's a lookback problem I guess my expected points will just be 1/(# of answers).
You and me both... I'm not memorizing that formula for at best 1 question, especially when that question will a) likely take more than 6 minutes b) presents a ton of opportunity for arithmetic errors c) could be a pilot question
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#14
07-10-2017, 11:18 PM
 ProvidenceOfRisk SOA Join Date: Nov 2015 Studying for Knowledge Posts: 20

I memorized it after a full day of studying when I didn't feel like doing anything else before bed.