Python for Finance

Chapter 5
sellingPrice/(1+R)**n
sellingPrice= d(n+1)/(r-g)
where g is long term growth rate
Example #1: >>> r=0.182
>>> g=0.03
>>> d=[1.8,2.07,2.277,2.48193,2.68,2.7877]
>>>pvValueNperiodModel(r,g,d)
17.472364312825711
"""
import scipy as sp
d=dividendNplus1
n=len(d)-1
g=longTermGrowthRate
pv=sp.npv(r,d[:-1])*(1+r)
sellingPrice=d[n]/(r-g)
pv+=sp.pv(r,n,0,-sellingPrice)
return pv
Appendix E – Python program to estimate the
duration for a bond
def durationBond(rate,couponRate,maturity):
"""Objective : estimte the durtion for a given bond
rate : discount rate
couponRate: coupon rate
maturity : number of years
Example 1: >>>discountRate=0.1
>>>couponRate=0.04
>>> n=4
>>>durationBond(rate,couponRate,n)
3.5616941835365492
"""
Example #2>>>durationBond(0.1,0.04,4)
3.7465335177625576
import scipy as sp
d=0
n=maturity
for i in sp.arange(n):
d+=(i+1)*sp.pv(rate,i+1,0,-couponRate)
d+=n*sp.pv(rate,nper,0,-1)
return d/sp.pv(rate,n,-couponRate,-1)
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