"The real challenge was to model all the interest rates simultaneously, so you could value something that depended not only on the three-month interest rate, but on other interest rates as well"
- John C. Hull
About this Quote
In this quote, John C. Hull is discussing the problem of accurately modeling rate of interest. He explains that the real challenge depends on having the ability to model several interest rates at the very same time. This is essential since lots of financial assets and investments are affected by more than just one rates of interest. By having the ability to model all the rate of interest at the same time, one can properly value these possessions and financial investments. This requires a deep understanding of how different rate of interest communicate with each other and how they impact the general monetary market. It is a complex task that needs a high level of proficiency and ability.
This quote is written / told by John C. Hull somewhere between October 31, 1939 and today. He was a famous Professor from USA.
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