A Two Model Approach of Assessing Asset Value Functions for Capital Investments
Davies, I
Department of Mathematics, Rivers State University, Orowurukwo, Port Harcourt, Nigeria.
Amadi, I. U. *
Department of Mathematics and Statistics, Captain Elechi Amadi Polytechnics, Port Harcourt, Nigeria.
Loko, O. P
Department of Mathematics and Statistics, Ignatius Ajuru University of Education, Rumuolumeni, Port Harcourt, Nigeria.
*Author to whom correspondence should be addressed.
Abstract
The benefit of monetary assets cannot be over emphasized because it stands as an engine room to every investment which accumulates wealth such as daily, weekly, monthly and yearly etc. In this study, a closed form solution of Stochastic Differential Equation (SDE) was successfully exploited for the analysis of asset values and other stock market quantities. The solutions of stock variables were critically observed by simulations which describe the behavior of asset values with respect to their maturity periods. Finally, the skewness and kurtosis of the asset values were obtained to give investors proper directions in terms of decision making.
Keywords: Asset value, kurtosis, skewness, stochastic analysis, prices