Ses 9: Forward and Futures Contracts I

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  • Опубліковано 9 тра 2013
  • MIT 15.401 Finance Theory I, Fall 2008
    View the complete course: ocw.mit.edu/15-401F08
    Instructor: Andrew Lo
    License: Creative Commons BY-NC-SA
    More information at ocw.mit.edu/terms
    More courses at ocw.mit.edu

КОМЕНТАРІ • 108

  • @alwaystoyou123
    @alwaystoyou123 3 роки тому +32

    His analogies are always on point. You better understand the concepts when you listen to his analogies. Amazing Professor and intellectual.

  • @rnavarrorubio
    @rnavarrorubio 8 років тому +81

    He is such a great professor.

  • @andrewstoehr
    @andrewstoehr Рік тому +8

    What a privilege to be able to watch this over and over again with instant replay for free. What a public good this is

    • @jacoboribilik3253
      @jacoboribilik3253 Місяць тому +1

      Education should be a free, essential resource.

  • @rohank2825
    @rohank2825 3 роки тому +5

    @55:40 this happened during covid-19 pandemic during march 2020, demand for oil dropped suddenly, and they were ready to supply to fill the contract.
    As the no body had storage solution oil price went negative at that time.

  • @user-tm8wy1hx7n
    @user-tm8wy1hx7n 9 років тому +54

    excellent... his lectures tells a whole new perspective... This is very different from the book reading of what futures and forwards are... Infact he cleared my year long doubts :) BTW thanks MIT for sharing

  • @weebgrinder
    @weebgrinder 2 роки тому +5

    I like how he's explaining current monetary policy at the beginning

  • @manavkashyap1927
    @manavkashyap1927 2 роки тому +7

    I love the discussion, everybody is welcomed with as many questions as possible.

  • @sudhirpatil3434
    @sudhirpatil3434 4 роки тому +26

    Prof is really interested in teaching -
    he makes complex stuff simple!
    By the way he seems to be genius...

    • @himjanand2034
      @himjanand2034 4 роки тому +1

      would u like to work with me through this course if u r still studying this ?

    • @ajibolaoshunnuga8441
      @ajibolaoshunnuga8441 4 роки тому +3

      Himja Nand I am. Are you?

    • @rahulsolai
      @rahulsolai 4 роки тому +2

      @@himjanand2034 i would

  • @mumuxi8823
    @mumuxi8823 4 роки тому +29

    funny that today 2020.04.20 oil price is < 1 dollar / barrel

    • @qwerty6574
      @qwerty6574 3 роки тому +1

      Hopefully you didn't buy puts with that price in mind

  • @hosszu2010
    @hosszu2010 3 місяці тому

    I am teaching very similar material (undergrad though) and I am watching him to learn how to teach better. Great service to share these videos, thank you.

  • @Xoro-rbk
    @Xoro-rbk 3 роки тому +4

    46:42 If any one didn't get the joke on AAA rating bonds. I will highly recommend you to watch the Oscar winning movie - The Big Short (2015)

  • @BoloBouncer
    @BoloBouncer 2 роки тому +2

    Honestly that visual of "If you're sales report is one currency, it's basically the opposite of selling in this other currency" really made things click for me.

  • @mmx914
    @mmx914 9 років тому +4

    I am glad I found these awesome lectures.
    Thank you very much!

  • @amcgregor679
    @amcgregor679 10 років тому +24

    Funny, had he had actually agreed to buy oil at $40/barrel in February 2009 (roughly 6 months from when this was made) he would have profited.

  • @theasz3012
    @theasz3012 2 роки тому +4

    That's great. Thanks for sharing.
    Long live MIT

  • @aku2rabie
    @aku2rabie 9 років тому +3

    This is soooo good! now got the real basics in ma head

  • @msa3533
    @msa3533 2 роки тому +2

    literally the best timing for a finance course lol

  • @oussamachouichi5677
    @oussamachouichi5677 7 років тому +4

    You rock Professor. Thank you

  • @SmartInvestor
    @SmartInvestor 10 років тому +8

    This topic was always a bit confuse for me, but now it is clear :). Thank you so much for sharing this content.

    • @NazriB
      @NazriB 2 роки тому

      Lies again? FAS FUS

  • @pwadamdennis2345
    @pwadamdennis2345 3 роки тому +1

    Very insightful lectures

  • @robertkelly9836
    @robertkelly9836 2 роки тому +2

    Oil price 3-3-22 Brent crude 118.11.

  • @badrakhariunchimeg1031
    @badrakhariunchimeg1031 Місяць тому

    Some times it's just that hard how you people manage all together

  • @monsiribalsook6017
    @monsiribalsook6017 2 роки тому +2

    Thank you, professor.

  • @alexlee557
    @alexlee557 7 років тому +25

    29:37 today after 3 years oil barrel costs USD 48

    • @VoltageLP
      @VoltageLP 4 роки тому +6

      less than $10 12 years later hahaha, so much for oil scarcity

    • @onceappuonatime
      @onceappuonatime 4 роки тому +12

      Oil price is negative as of April 23 2020

    • @naderetaiwi4683
      @naderetaiwi4683 3 роки тому

      @@onceappuonatime should have bought that goddamn forward contract and sold for $40.

  • @BC-lz4sv
    @BC-lz4sv 6 років тому

    Thanks Andrew Lo

  • @zenglin01
    @zenglin01 2 роки тому +1

    So so so so great professor!!!!!

  • @maxberghofer4775
    @maxberghofer4775 2 роки тому

    Great video and great prof

  • @unknownx2k7
    @unknownx2k7 8 років тому

    Thanks to the wonderful andrew lo

  • @thinkmackay8954
    @thinkmackay8954 2 роки тому

    Great lecture 👌 Thanks.

  • @sajalsalahuddin5861
    @sajalsalahuddin5861 2 роки тому

    How would the changing future contract prices relate to the strategic pricing of Soy bean product by the manufacturer who buying the soybeans from the farmer?

  • @ayubwangera4833
    @ayubwangera4833 7 років тому +2

    very informative

  • @kasivamutisya7172
    @kasivamutisya7172 10 місяців тому

    Great lecturer.

  • @Zoheba
    @Zoheba 9 років тому +36

    Kanye West doing his MBA :-P He's on the right side sitting :P

    • @noueruz-zaman7894
      @noueruz-zaman7894 6 років тому +2

      haaaa.this comment made my day

    • @MichaelTheThinker
      @MichaelTheThinker 3 роки тому +2

      Kanye wishes this was him.

    • @VNH05
      @VNH05 3 роки тому +1

      In 2021 Kanye has already 4 kids with Kim and filed for divorce ☺️

  • @prdtrader
    @prdtrader 9 років тому +2

    Trading is a business ,who understand that they will succeed,off course you need a system to give you an edge and discipline.What a system does ,it will show you entry ,exit,how much you can risk,if you stick to the system you will be disciplined.But saying that only your risk to reward ratio will bail you out at the end of the day.

  • @RaylinRecords
    @RaylinRecords 3 роки тому +3

    14:54 - I was listening to a podcast recently from Robert Kiwosaki, and he indicated his involvement in investing in Uranium and other commodities. Does anyone know why he would be interested in this venture? He was also speaking about Warren Buffet buying Gold miner and how he's buying other commodities like agriculture. It's interesting that during this pandemic, he would buy Uranium. He didn't explicitly say why. Does anyone know?

  • @ItsRhssoo
    @ItsRhssoo 7 років тому

    Excellent

  • @sethwils6077
    @sethwils6077 6 років тому

    Thank you

  • @Tom-tb7sq
    @Tom-tb7sq 4 роки тому +5

    Guy at 29:00 is laughing now with the negative spot price and the oil market in contango

  • @hugom6388
    @hugom6388 6 років тому

    Where are the 'brent seas'?

  • @MrAbdulaziz05
    @MrAbdulaziz05 7 років тому +1

    im going to* get smart and get back to you prof .peace

  • @RaylinRecords
    @RaylinRecords 3 роки тому +5

    18:36 - This is also very interesting because American Barrick is considered a safe-haven in gold mining and market volatility. During the pandemic, Warren Buffet, who had an aurophobia, decided to invest in this gold mining company. According to my research, gold mining is a good way to hedge against concerns about rising inflation and is a safe-haven in very volatile markets. Does anyone agree or have additional information?

    • @sgpleasure
      @sgpleasure 2 роки тому

      To hedge against Inflation, you are better off buying Gold ETFs. Get exposed to Gold as an asset and remove the company specific risks with American Barrick.

    • @ozcanyldz1718
      @ozcanyldz1718 2 роки тому

      @@sgpleasure well i heard buffet doesnt like anything that doesnt have cash flow so cant say i would be surprised that he invesst in mining company rather than buying gold or gold etf :) also he probably know the company well enough to bet on it so he can get extra earnings from growth of the company in addition to rising(if) gold price.

  • @muhammadaliimranbjalaludin653

    damn I wish I studied finance in America, such a useful lecture

  • @NimitKhuranaa
    @NimitKhuranaa 2 роки тому

    1:01:00
    if forward contract's price is 15$ 1 month into contract, then why the value of contract not 5$ at t=0, when spot price = 160 and forward price = 165$?

    • @sgpleasure
      @sgpleasure 2 роки тому +1

      Refer back to his lectures on Net Present Value. The forward price $165 is the value in the future. The spot price is NOW.

    • @NimitKhuranaa
      @NimitKhuranaa 2 роки тому

      @@sgpleasure thanks

  • @Texas_Uncut
    @Texas_Uncut 25 днів тому

    Would there be countries that would be opposed of the idea of using blockchain technology? 😅

  • @angryjalapeno
    @angryjalapeno 11 років тому

    I don't understand; professor derides people who want to suspend mark to market but then goes ahead and say that prices are wrong when there is no liquidity. But that's exactly the problem with some interest rate products at the time; there were no liquidity therefore the prices are not valid and therefore should not be used for marking to market.

    • @duartepombo551
      @duartepombo551 4 роки тому

      Although the price is not valid, theoretically it is still the best guess there is, meaning that you should take that price as valid for the time being I guess

  • @normanjtongmd
    @normanjtongmd 8 років тому +6

    $40/barrel of oil?
    DEAL!
    (iT IS 29.71 TODAY!)

    • @arupian666
      @arupian666 8 років тому

      +Jay Musting Ha ! Yeah, I'd love crude @ $40/barrel right now... my long calls wouldn't be looking so unhappy....

    • @alexb8560
      @alexb8560 3 роки тому +1

      Oh yeah? A month ago it was -$38.

  • @daphnecheung1026
    @daphnecheung1026 4 роки тому

    Online brokerages are so popular now.

  • @harryhu3090
    @harryhu3090 4 роки тому

    Look at the oil price now...

  • @pratekag
    @pratekag 3 роки тому

    Uranium - 235

  • @felixthefoxMEXICO
    @felixthefoxMEXICO 4 роки тому

    These forward markets are highly liquid *Coughs*

  • @ABWprod
    @ABWprod 4 роки тому +7

    Here we go about Argentine again

  • @arrowb3408
    @arrowb3408 3 роки тому

    Coming here to get the forward contract rule and principles in European style. Yes, got all what I want from the Critical Concept. Yeah.
    Time changes rapidly compared the time of this lecture esp the prices. But the main principle of finance is THE SAME. HAHAHA

    • @weebgrinder
      @weebgrinder 2 роки тому

      So are European and American forwards and futures contracts similar?

  • @marcogelsomini7655
    @marcogelsomini7655 2 роки тому

    1:01:05 that's interesting

  • @badrakhariunchimeg1031
    @badrakhariunchimeg1031 Місяць тому

    I buy gas don't khow how gas station undergoes structure don't have to khow it as long as people pay for km

  • @forheuristiclifeksh7836
    @forheuristiclifeksh7836 10 місяців тому

    46:14

  • @ayamkampus7385
    @ayamkampus7385 4 роки тому

    10:40

  • @neelmoradiya1389
    @neelmoradiya1389 Рік тому +1

    🇮🇳🇮🇳🙏🙏👍👍

  • @Signonthisline
    @Signonthisline 2 роки тому

    Money printer go brrrrrrrr

  • @mikerosy6924
    @mikerosy6924 2 роки тому

    As a person with substantial science/arts of finance and statistics background, he explains it extremely well patiently. I’m surprised this is a MIT fin402 course; students are asking weak questions. Then again, im 36 years old and have been a Wall Street junky since I was 14. Cheers 🥂 folks, hope you’ll succeed.

    • @treyk7239
      @treyk7239 Рік тому

      I think it's because it's an mba course; not everyone is coming into the program with prior finance or business education. I'm undergraduate and just getting into finance and this is really simple to follow even without the supplemental textbook readings.

    • @liamtarr
      @liamtarr Рік тому +1

      People are coming here to learn, no such thing as a weak question.

  • @johnstfleur3987
    @johnstfleur3987 Рік тому

    "PRIME."(61)

  • @kartikeygarg3694
    @kartikeygarg3694 3 роки тому

    Lol oil price went negative in 2020.

  • @johnstfleur3987
    @johnstfleur3987 Рік тому

    "15."

  • @johnstfleur3987
    @johnstfleur3987 Рік тому

    "I AM L."

  • @kopde
    @kopde 3 роки тому +4

    I wonder if anyone in that audience is a billionaire yet...

  • @johnstfleur3987
    @johnstfleur3987 Рік тому

    V.

  • @Dboyvc1
    @Dboyvc1 8 років тому

    who the hell is this guy?

    • @scrubbreviews9482
      @scrubbreviews9482 8 років тому +12

      +Danny Riley a finance professor at MIT with a PhD in econ from harvard that founded a quant investment company. he governed the boston exchange and is an editor for like 5 stat journals.

    • @MyKkata
      @MyKkata 8 років тому +16

      who the hell r U?

    • @lincha3216
      @lincha3216 8 років тому

      +MyKkata LOL

    • @viprawsrivastava8824
      @viprawsrivastava8824 4 роки тому +1

      big daddy!!

  • @arrowb3408
    @arrowb3408 4 роки тому +4

    At 3:30 that foreign female student brought up numerous lengthy comments without any point at all but her personality speech show. Come on. What is her point among whole bunch of words?.....STF

    • @no_type0122
      @no_type0122 3 роки тому +4

      What's ur point writing that?

    • @boo7840
      @boo7840 2 роки тому +1

      “foreign” countries have financial markets that function on the same economic grounds that ours do. She lived through a similar situation that occurred in Argentina and wanted to share her experience. Hope that helps bro

    • @santiagovarela2298
      @santiagovarela2298 Рік тому

      Average Argy, so self important and trying to show off