"If each of your time steps is one week long, you are not modeling the stock price terribly well over a one-week time period, because you are saying that there are only two possible outcomes"
- John C. Hull
About this Quote
This quote by John C. Hull is referring to the use of time actions when modeling stock costs. If each time step is one week long, then the design is not properly representing the stock cost over a one-week period. This is because the model is just representing 2 possible outcomes, which is inadequate to accurately represent the stock price. Hull is recommending that the time actions ought to be shorter in order to more accurately represent the stock price. By having shorter time actions, the design can account for more possible outcomes and therefore more accurately represent the stock rate. This quote is highlighting the importance of having accurate time actions when modeling stock rates in order to get the most accurate outcomes.
This quote is written / told by John C. Hull somewhere between October 31, 1939 and today. He was a famous Professor from USA.
The author also have 18 other quotes.
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"Well, I think any time you delve into this sort of religion, politics, as you well know, you're going to, you know, touch a few nerves. I wasn't - now - and this is the honest truth"
