---
title: "Lecture 3 Note"
author: "Yiming Gong"
date: "2021-07-19T03:36:35Z"
link: "https://bookdown.org/yg484/lec_3_note/"
length_weight: "2.2%"
pinned: false
---

Lecture 3 note [...] Suppose that two assets are traded: one risk-free and one risky security. The
former can be thought of as a bank deposit or a bond issued by a government,
a financial institution, or a company. The risky security will typically be some
stock. It may also be a foreign currency, gold, a commodity or virtually any
asset whose future price is unknown today. Throughout the introduction we restrict the time scale to two instants only:
today, t = 0, and some future time, say one year from now, t = 1. More refined
and realistic situations will be studied in later chapters. The ...
