Valuation of Complex Financial Instruments [Basics]
Fair value is an integral part of the complex financial instruments accounting. In this presentation, you will learn about valuation methodologies used in valuing complex financial instruments such as derivatives, convertible debt, and earn-outs. We start with an overview of the complex financial instrument landscape and the need for more sophisticated methodologies. We will provide a quick and intuitive overview of:
Binomial/lattice models,
Monte Carlo, and
Close-form solutions.