Common use of Numerical results Clause in Contracts

Numerical results. In this section we first consider a stock loan contract with an automatic ter- mination clause a (a ∈ [0, q]), r = 0.05, γ = 0.07, σ = 0.15, δ = 0.01, q = 100 and S 0 = 100. We will give six numerical examples to show that how the liquidity, optimal strategy b(a), initial value fa(x) and initial cash q − c depend on automatic termination clause a, respectively. Example 7.1. We see from graph1 below that the liquidity obtained with automatic termination clause is larger than the circumstance without the automatic termination clause. When the initial stock price S 0 = 100 and a = 100, the client just sell the stock to the bank by the stock loan contract with automatic termination clause. Figure 1. γ = 0.07, r = 0.05, σ = 0.15, δ = 0.01, q = 100, S 0 = 100 Example 7.2. We see from graph 5 below that b is an function of a. Both the client and the bank will take the deal when the initial stock price is in

Numerical results. In this section we first consider a stock loan contract with an automatic ter- mination clause a (a ∈ [0, q]), r = 0.05, γ = 0.07, σ = 0.15, δ = 0.01, q = 100 and S 0 = 100. We will give six numerical examples to show that how the liquidity, optimal strategy b(a), initial value fa(x) and initial cash q − c depend on automatic termination clause a, respectively. Example 7.1. We see from graph1 below that the liquidity obtained with automatic termination clause is larger than the circumstance without the automatic termination clause. When the initial stock price S 0 = 100 and a = 100, the client just sell the stock to the bank by the stock loan contract with automatic termination clause. Figure FIGUrE 1. γ = 0.07, r = 0.05, σ = 0.15, δ = 0.01, q = 100, S 0 = 100 Example 7.2. We see from graph 5 below that b is an function of a. Both the client and the bank will take the deal when the initial stock price is in