BusinessInvestingEducation

Patrick Boyle

Patrick Boyle is a hedge fund manager, a university professor and a former investment banker.

This channel is all about quantitative finance. By subscribing you will see videos explaining what is happening in markets right now, you will learn about financial derivatives, corporate finance and how traders use quantitative tools like statistics. You will see interviews with some of the most interesting people in the financial industry. In addition, you will see some longer form documentaries on the history of financial markets.

To contact Patrick go to the website http://onfinance.org

DISCLAIMER:
This channel is not affiliated with any financial institution. The videos on this channel are for entertainment purposes only and do not constitute financial advice. Those seeking investment advice should seek out a registered professional. Patrick is not responsible for investment actions taken by viewers and his content should not be used as a basis for investment.

Links:
Amazon Author Page: https://amzn.to/3bTeqed
Patreon: https://www.patreon.com/PatrickBoyleOnFinance
Website: https://www.onfinance.org/
Instagram: https://www.instagram.com/patrickeboyle/
BlueSky: https://bsky.app/profile/pboyle.bsky.social

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Friday · 16 min
What are index options? What are currency options?
In todays video we will learn about options on foreign exchange and index options. These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle Options on Stock Indices - what are index options? A stock market index is a method of measuring the price movements of a basket of stocks in a market. Many indices are cited by the media and are used as benchmarks to measure the performance of portfolios such as mutual funds. Some are price indices and some are total return indices, meaning that they include reinvested dividends over time. There are a number of different index types. National indices represent the performance of the stock market of a given nation. Sector indices track the performance of specific industry sectors in the market. Ethical indices include only those companies that satisfy certain ecological, religious, or social criteria. Index options exist on broad-based indices like the S&P500 or the Russell 3000. They also exist on more narrowly based indices like mining indices or semiconductor indices. The global market for exchange-traded stock market index options is notionally valued by the Bank for International Settlements at hundreds of billions per year. When OTC options are added to that, you can see that it is a very large market indeed. An index option is a financial derivative that gives the holder the right, but not the obligation, to buy or sell a basket of stocks, such as the S&P500, at a pre-agreed price on a specified date. An index option is similar to other options contracts, the difference being the underlying instruments are indexes. Index options are typically cash settled. Uses of Index Options There are two main reasons that investors will pursue index options. 1. Portfolio insurance: Investors with large stock portfolios may wish to insure their downside risk by buying put options. 2. Speculation: Portfolio managers may wish to use index options to speculate on the direction of the overall market, or on the volatility of the overall market. Foreign Exchange Options - What are currency options? A foreign exchange option is a derivative where the owner has the right but not the obligation to exchange money denominated in one currency into another currency at a pre-agreed exchange rate on a specified date. European and American options on foreign exchange are actively traded on both exchanges and OTC. Companies frequently use them to hedge foreign exchange risk, and they are commonly used to speculate on the price and volatility of various foreign exchange pairs. The foreign exchange options market is mostly an OTC market. A GBP/USD foreign exchange call option, can also be viewed as being a USD/GBP put option, as they each give the option owner the right but not the obligation to exchange a certain amount of US dollars for British pounds at a pre-agreed exchange rate on a specified date. The Black-Scholes model can be modified to price options on foreign exchange. The modified Black-Scholes model was developed in 1983 by Garman and Kohlhagen and is known as the Garman-Kohlhagen model. It is a modification of the Black-Scholes model which accounts for the different interest rates of each currency. You can think of options on currencies as being an options position with an annual percentage dividend embedded in the form of the foreign currencies’ risk-free rate. Learn more about your ad choices. Visit megaphone.fm/adchoices
Friday · 36 min
The Real Reason You Can't Afford a House
Stop paying for GPT, Claude, and Gemini separately. 🙅‍♂️ Genspark puts them all in one workspace. One subscription. Three killer features: 🔍 Fact Check – 30 rounds of live verification with source proof 📝 AI Meeting Notes – Record on your phone, auto-share professional notes 🎨 AI Designer – Thumbnails, social graphics, anything you need New users get free credits. Paid subscribers get unlimited AI Chat + AI Image for 2026. Try Genspark today 👉https://www.genspark.ai/?utm_source=yt&utm_campaign=PBoyle04 @GensparkProduct #Genspark #ai #WorkWithGenspark A three-bedroom "dunger" in New Zealand with peeling paint and boarded-up windows sold for 1.81 million dollars at the peak of the boom. A few years later, prices had fallen by as much as a third in real terms, recent buyers were trapped in negative equity, and thousands of construction firms had gone under. In this video we look at how a national housing boom turns into a bust, why house prices became so unaffordable in the first place, and what it means for an economy when the family home stops being a place to live and becomes a leveraged investment. Along the way we cover the interest-rate math behind home affordability and why falling mortgage rates inflated prices for forty years, the politics of why governments keep house prices rising, why high housing costs drive young workers to emigrate, and the lessons from past property crashes in Japan, the United States, and Ireland. We also look at Henry George's argument for a land value tax, Edward Leamer's "Housing IS the Business Cycle," and why an efficient property market matters for the whole economy. Whether you're in the US, UK, Canada, Australia, or anywhere else watching house prices climb out of reach, the underlying dynamics are the same. Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices
Friday · 14 min
What Is Options Delta? The Options Greeks
These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle What is Options Delta? The first Greek we will learn about in this video series is Delta, which measures how much an option's price will change for a 1% change in the price of the underlying security or index. For example, a Delta of 0.40 means that the option's price will theoretically move $0.40 for every $1 move in the price of the underlying stock or index. Call options Have a positive Delta that can range from zero to 1.00. At-the-money options usually have a Delta near .50. The Delta will increase (and approach 1.00) as the option gets deeper in the money. The Delta of in-the-money call options will get closer to 1.00 as expiration approaches. The Delta of out-of-the-money call options will get closer to zero as expiration approaches. Put option Delta Put options have a negative Delta that can range from zero to -1.00. At-the-money options usually have a Delta near -.50. The Delta will decrease (and approach -1.00) as the option gets deeper in the money. The Delta of in-the-money put options will get closer to -1.00 as expiration approaches. The Delta of out-of-the-money put options will get closer to zero as expiration approaches. You also might think of Delta, as the percent chance (or probability) that a given option will expire in the money. For example, a Delta of 0.40 means the option has about a 40% chance of being in the money at expiration. This doesn’t mean your trade will be profitable. That of course, depends on the price at which you bought or sold the option. You also might think of Delta, as the number of shares of the underlying stock, the option behaves like. A Delta of 0.40 also means that given a $1 move in the underlying stock, the option will likely gain or lose about the same amount of money as 40 shares of the stock. Tune in tomorrow for a video on Delta Hedging. Learn more about your ad choices. Visit megaphone.fm/adchoices
Friday · 7 min
What are Currency Swaps?
In todays video we learn about currency swaps. These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle What are currency swaps? A currency swap is a financial derivatives agreement in which two parties exchange the principal amount of a loan and the interest in one currency for the principal and interest in another currency. At the inception of the swap, the equivalent principal amounts are exchanged at the spot rate. During the length of the swap each party pays the interest on the swapped principal loan amount. At the end of the swap the principal amounts are swapped back at either the prevailing spot rate, or at a pre-agreed rate such as the rate of the original exchange of principals. Using the original rate would remove transaction risk on the swap. Currency swaps are used to obtain foreign currency loans at a better interest rate than a company could obtain by borrowing directly in a foreign market or as a method of hedging transaction risk on foreign currency loans which it has already taken out. Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 38 min
Argentina's Memecoin Disaster
Get 50% off your first order of CookUnity meals — go to https://cookunity.com/pboyle50 and use my code PBOYLE50 at checkout to try them out for yourself! Thanks to CookUnity for sponsoring this video! Argentina’s president Javier Milei has been rocked by a scandal over his promotion of a memecoin called $LIBRA which soared in value before collapsing last week, triggering lawsuits and calls for impeachment. Buyers of the cryptocurrency accused the coin’s creators of - what is known as a “rug pull” scheme, a type of crypto pump and dump scheme - where the promoters draw in buyers, only to stop trading and make off with the money raised from token sales. The same team who launched the Argentina linked meme token are also behind Donald Trump's wife's Melania Coin - which performed similarly. In today's video we discuss whether elected representatives should be involved in cryptocurrency investments. Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Coffeezilla Libra Interview: https://www.youtube.com/watch?v=EqizJTbxAEM&t=3261s Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 49 min
We Need To Talk About Leopold
Taking care of your health just got easier, thanks to my sponsor Zocdoc! Start here at: https://zocdoc.com/patrickboyle Last week, 24-year-old Leopold Aschenbrenner — former FTX staffer, ex-OpenAI researcher, and author of the viral 165-page essay "Situational Awareness" — managed to lose roughly two-thirds of his $45 billion hedge fund in a matter of weeks. The margin calls arrived during his wedding weekend. In this video I break down how a trader with no professional experience raised billions from Silicon Valley, why his AI "hedge" wasn't a hedge at all, and how leverage plus a concentrated bet on artificial intelligence stocks turned a great-looking expected return into a catastrophic outcome. Along the way we look at the cultural gap between Silicon Valley and Wall Street, why Ken Griffin's Citadel ended up buying the collapsing portfolio in an overnight fire sale, and the maths of volatility drag — the reason a high expected return can still drag an investor's typical outcome straight into the ground. It's a story about leverage, risk management, expected versus median returns, and what happens when you go "full Kelly." Featuring reporting from the Wall Street Journal, The New York Times, Bloomberg, and the Financial Times, plus Victor Haghani's lessons from The Missing Billionaires. Victor Haghani - The Missing Billionaires book: https://amzn.to/4fQUEEB Elm Wealth Website: https://elmwealth.com/ Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 23 min
What are Real Options? - Real Options Valuation Method For Capital Budgeting Decisions
Real options valuation, also often termed real options analysis, applies option valuation techniques to capital budgeting decisions. These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Patreon Page: https://www.patreon.com/PatrickBoyleOnFinance Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle A real option itself, is the right but not the obligation to undertake certain business initiatives, such as deferring, abandoning, expanding, staging, or contracting a capital investment project. For example, the opportunity to invest in the expansion of a firm's factory, or alternatively to sell the factory, is a real call or put option, respectively. Real options are generally distinguished from conventional financial options in that they are not typically traded as securities, and do not usually involve decisions on an underlying asset that is traded as a financial security. A further distinction is that option holders here, i.e. management, can directly influence the value of the option's underlying project; whereas this is not a consideration as regards the underlying security of a financial option. Moreover, management cannot measure uncertainty in terms of volatility, and must instead rely on their perceptions of uncertainty. Unlike financial options, management also have to create or discover real options, and such creation and discovery process comprises an entrepreneurial or business task. Real options are most valuable when uncertainty is high; management has significant flexibility to change the course of the project in a favorable direction and is willing to exercise the options. Real options analysis, as a discipline, extends from its application in corporate finance, to decision making under uncertainty in general, adapting the techniques developed for financial options to "real-life" decisions. For example, R&D managers can use Real Options Valuation to help them allocate their R&D budget among diverse projects; a non business example might be the decision to join the work force, or rather, to forgo several years of income to attend graduate school. It, thus, forces decision makers to be explicit about the assumptions underlying their projections, and for this reason ROV is increasingly employed as a tool in business strategy formulation. This extension of real options to real-world projects often requires customized decision support systems, because otherwise the complex compound real options will become too intractable to handle. Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 54 min
Scott Bessent Is at War With Prices — and Prices Are Winning!
Go to http://ground.news/pb for a better way to stay informed. Subscribe for 40% off unlimited access to worldwide coverage through my link. Treasury Secretary Scott Bessent is trying to force down US Treasury yields with surprise bond buybacks — and it isn't working. In this video we break down Bessent's activist debt management strategy, why doubling the Treasury's long-dated buybacks is a bet on falling interest rates funded by short-term bills, and why his old boss Stanley Druckenmiller publicly tore the plan apart in a Wall Street Journal op-ed ("Let the Bond Market Speak"). We look at the collision with new Federal Reserve Chair Kevin Warsh after Jackson Hole, the 50% tariffs on Canada and the Mark Carney feud, "Operation Economic Outcast" and the secondary-sanctions problem with China and Iranian oil, the GENIUS Act and crypto's role in sanctions evasion, and Stephen Miran's case for the defense. The through-line: you can't trade around arithmetic. When a government goes to war with market prices, the bond market has an infinite balance sheet — and prices tend to win. Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 34 min
Panic In the Car Market - Americans Rush to Beat Tariffs!
Go to https://ground.news/pb to get up to 40% off unlimited access to stay fully informed. Subscribe through my link this month for 40% off unlimited access. Americans have ben rushing to change their cars as President Trump’s 25% tariffs on imported cars and car parts remain in effect despite the deferral of other country-based taxes that were announced last week. Analysts are predicting a drop in vehicle sales, higher new and used car prices, and increased industry costs of more than $100 billion dollars. How will you be affected by Trump's new car tariffs? Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 32 min
The Infinite Money Glitch is Broken!
Get an exclusive 15% discount on Saily data plans! Use code BOYLE at checkout. Download Saily app or go to https://saily.com/boyle For years, firms like MicroStrategy turned buying Bitcoin into a corporate cheat code—raising billions, pumping token prices, and fueling meme-driven hype. But the magic loop has snapped. In this video, we break down why the “infinite money glitch” stopped working, how leveraged ETFs magnified losses, and why even Michael Saylor is now hoarding dollars. From gamma trades to meme economics, this is the story of how hype capitalism hit a wall. Zeke Faux on @GoodWorkMB : https://www.youtube.com/watch?v=exoNex2Yn5w Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 45 min
The Book That Wasn’t Supposed to Exist - Epstein's Birthday Book Released!
Go to https://surfshark.com/boyle or use code BOYLE at checkout to get 4 extra months of Surfshark VPN! In 2003, Ghislaine Maxwell compiled a 238-page leather-bound book for Jeffrey Epstein — filled with letters, sketches, poems, and photos from billionaires, politicians, scientists, and celebrities. This book was never meant to be public. But now, thanks to the House Oversight Committee, it’s part of the public record — and it’s worse than anyone expected. We’ll also explore the deeper questions: Where did Epstein’s money come from? Why hasn’t the government followed the money? And what does this say about the two-tiered justice system in America? This scandal isn’t just about Epstein. It’s about the system that made him possible. Link to my original Epstein Video: https://youtu.be/CbJSgan4mfQ Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 7 min
What are the Option Greeks? | Hedging Options | Risk Managing Options
These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle If you're an options investor, you may have heard about "Greeks" but you may not know exactly what they are or what they can do for you. If so, watch this series of videos where Patrick Boyle explains what these Greek letters mean and how to use them to better understand the price of an option. What can option Greeks do for you? Using the Greeks, an options investor can make more informed decisions about which options to trade, and when to trade them. Consider some of the things Greeks may help you do: Gauge the likelihood that an option you're considering will expire in the money (Delta). Estimate how much the Delta will change when the stock price changes (Gamma). Get a feel for how much value your option might lose each day as it approaches expiration (Theta). Understand how sensitive an option might be to large price swings in the underlying stock (Vega). Simulate the effect of interest rate changes on an option (Rho). What are Greeks anyway? Greeks, including Delta, Gamma, Theta, Vega and Rho, measure the different factors that affect the price of an option contract. They are calculated using a theoretical options pricing model (see How much is an option worth?). Since there are a variety of market factors that can affect the price of an option in some way, assuming all other factors remain unchanged, we can use these pricing models to calculate the Greeks and determine the impact of each factor when its value changes. For example, if we know that an option typically moves less than the underlying stock, we can use Delta to determine how much it is expected to move when the stock moves $1. If we know that an option loses value over time, we can use Theta to approximate how much value it loses each day. what is delta gamma theta vega in options Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 8 min
What are forward rates? What are forward rate agreements? What is an FRA?
In todays video we will learn about forward interest rates and a derivative called a forward rate agreement or FRA. These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle What are Forward Rates? A forward rate is an interest rate implied for periods of time in the future by zero-coupon bonds. For example, the market implied yield on a three-month Treasury bill three months from now is a forward rate. If we know what the three-month zero-coupon Treasury bill rate is and what the six-month zero-coupon Treasury bill rate is, we can back out what the market is implying as the yield on a three-month Treasury bill three months from now. To calculate forward rates we just need the zero-coupon yield curve. What are Forward Rate Agreements? A forward rate agreement (FRA) is an over-the-counter agreement to borrow a fixed amount of money at a fixed interest rate at a specified future time period. Banks and large corporations can use FRAs to hedge future interest rate exposures. The buyer hedges against the risk of rising interest rates, while the seller hedges against the risk of falling interest rates. Speculators can use FRAs to make bets on future changes in interest rates. Rates in the future will usually be different from the implied rate at the time you entered into a forward-rate-agreement, giving rise to gains or losses on the agreed transaction. What is an FRA? An FRA is an abbreviated term for Forward Rate Agreement Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 13 min
What are Variance Swaps? Financial Derivatives - Trading Volatility
In todays video we learn about variance swaps These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle What is a Variance Swap? A variance swap is a financial derivative used to hedge or speculate on the magnitude of a price movement of an underlying asset. A variance swap is a forward contract with a payoff based on the realized variance of the underlying asset. Variance swaps settle in cash based on the difference between the realized variance and the variance strike Similar to a regular swap, one of the two parties involved in the transaction will pay an amount based upon the actual variance of price changes of the underlying asset. The other party will pay a fixed amount, called the strike, specified at the start of the contract. The strike is typically set at the start to make the net present value of the payoff zero. At the end of the contract, the net payoff to the counterparties will be the notional amount multiplied by the difference between the variance and the strike variance, settled in cash. Due to any margin requirements specified in the contract, some payments may occur during the life of the contract should the contract's value move beyond the agreed limits. The variance swap, in mathematical terms, is the arithmetic average of the squared differences from the mean value. The square root of the variance is the standard deviation. A variance swap is a pure-play on an underlying asset's volatility. Options also give an investor the possibility to speculate on an asset's volatility. But, options carry directional risk, and their prices depend on many factors. There are two main classes of users for variance swaps. Speculators use these swaps to speculate on the future level of volatility for an asset. Hedgers use variance swaps to cover short volatility positions. They are similar to volatility swaps, watch my video on those here. https://www.youtube.com/watch?v=qclLj3E5zyk Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 37 min
Trump’s $2B Chip Deal: Nvidia’s Big Payout Explained
Go to https://ground.news/pb to get up to 40% off unlimited access to stay fully informed. Subscribe through my link this month for 40% off unlimited access. In this deep dive, we unpack Donald Trump’s controversial deal with Nvidia and AMD — a 15% revenue-sharing arrangement that allows U.S. AI chips to be exported to China. Is this a clever geopolitical strategy or a dangerous precedent that monetizes national security? We explore: How the deal was brokered and what it means for U.S. trade policy Legal and constitutional concerns surrounding export controls Strategic risks of enabling China’s AI development Comparisons to China’s rare earth leverage and Xi Jinping’s CEO control The broader pattern of Trump’s executive interference in private enterprise Featuring analysis on the H20 chip, inference bottlenecks, golden shares, and the future of American capitalism. Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 9 min
Time Varying Volatility and GARCH in Risk Management
These classes are all based on the book Trading and Pricing Financial Derivatives, available on Amazon at this link. https://amzn.to/2WIoAL0 Check out our website http://www.onfinance.org/ Follow Patrick on twitter here: https://twitter.com/PatrickEBoyle In Todays video let's learn about time varying volatility and GARCH in risk management Follow Patrick on Twitter Here: https://twitter.com/PatrickEBoyle What Is Time-Varying Volatility? Time-varying volatility refers to the changes in market volatility over different time periods. Investors may choose to study or consider volatility of an underlying security during various time periods. The use of time-varied volatility measures can influence the expectations of investments. How Time-Varying Volatility Works Time-varying volatility can be studied in any time-frame. Generally, volatility analysis requires mathematical modeling to generate volatility levels as one measure of the risk of an underlying security. This type of modeling generates historical volatility statistics. What is the GARCH Process? The generalized autoregressive conditional heteroskedasticity (GARCH) process is an econometric term developed in 1982 by Robert F. Engle, an economist and 2003 winner of the Nobel Memorial Prize for Economics, to describe an approach to estimate volatility in financial markets. There are several forms of GARCH modeling. The GARCH process is often preferred by financial modeling professionals because it provides a more real-world context than other forms when trying to predict the prices and rates of financial instruments. Heteroskedasticity describes the irregular pattern of variation of an error term, or variable, in a statistical model. Essentially, where there is heteroskedasticity, observations do not conform to a linear pattern. Instead, they tend to cluster. The result is that the conclusions and predictive value one can draw from the model will not be reliable. GARCH is a statistical model that can be used to analyze a number of different types of financial data, for instance, macroeconomic data. Financial institutions often use this model to estimate the volatility of returns for stocks, bonds and market indices. They use the resulting information to help determine pricing and judge which assets will potentially provide higher returns, as well as to forecast the returns of current investments to help in their asset allocation, hedging, risk management and portfolio optimization decisions. Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 36 min
What Caused The Financial Crisis of 2008?
In todays video we will discuss the Credit Crunch, and the role played by credit derivatives and securitization. Buy My Book Here: https://amzn.to/2wDMInh The Big Short https://amzn.to/2JcyAnx Soros Book https://amzn.to/2JdEqFf Follow Patrick on Twitter Here: https://twitter.com/PatrickEBoyle Credit Derivatives and the Financial Crisis of 2007 -2008 What Caused the Financial Crisis of 2008? Easy availability of credit in the United States, fueled by low interest rates and reduced credit monitoring by financial institutions, led to a housing boom which facilitated debt-financed consumer spending. The existence of credit derivatives and securitization allowed financial institutions to make larger volumes of riskier loans than had been made in the past and consumers assumed an unprecedented debt load. Between 1998 and 2006, the price of the typical American house increased by 124%. Between 1981 and 2001, the national median home price ranged from 2.9 to 3.1 times median household income. This rose to 4.6 times median household income in 2006. When home prices declined in the latter half of 2007 and the secondary mortgage market collapsed, a global financial crisis was triggered. Credit derivatives were blamed by many for bringing about this crisis, or for intensifying it. Credit ratings agencies are widely believed to have failed the markets in their calculations of credit risks on credit derivative products in the lead up to the financial crisis of 2007-2008. They relied on models that were given to them by the credit derivative issuers. The fact that they are paid by the security issuer, rather than the buyer, brought their impartiality into question. There is a structural conflict in this market whereby investors are the beneficiaries or ultimate end users of credit ratings calculations, yet the party paying for the ratings themselves is the issuer. On the back of the financial crisis, politicians and regulators globally are pressuring originators to resume the former practice of maintaining at least some of the credit risks on the instruments they originate on their own balance sheets. Politicians face a trade-off of hoping to incentivize high consumer spending and home-ownership rates to boost GDP and achieve social goals associated with home-ownership while seeking to avoid the negative outcomes from widespread over-indebtedness from lax credit standards and real estate bubbles. Stronger credit controls stabilize an economy but reduce home values, decrease homeownership levels, and reduce an economy’s GDP growth. Learn more about your ad choices. Visit megaphone.fm/adchoices
Thursday · 43 min
Elon Musk Admits DOGE Was a Failure!
Thank you to Bilt for sponsoring this video! Start earning rewards on rent right now when you sign up at https://biltrewards.yt.link/MtRNXAD DOGE promised to cut $2 trillion from the U.S. budget. Instead, it delivered chaos, memes, and a black eye—literally. In this video, we unpack Elon Musk’s candid post-mortem on the Department of Government Efficiency, why the savings never showed up, and how the “Manhattan Project of our time” turned into a bottle rocket. From the Wall of Receipts to the IRS meltdown and USAID’s woodchipper moment, we follow the money (and the missing billions) using Treasury data, Brookings analysis, and some jaw-dropping anecdotes. If you want the truth behind the headlines—and a few laughs along the way—this is the deep dive you’ve been waiting for. Patrick's Books: Statistics For The Trading Floor: https://amzn.to/3eerLA0 Derivatives For The Trading Floor: https://amzn.to/3cjsyPF Corporate Finance: https://amzn.to/3fn3rvC Ways To Support The Channel Patreon: https://www.patreon.com/PatrickBoyleOnFinance Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle Visit our website: https://www.onfinance.org Follow Patrick on Twitter Here: https://bsky.app/profile/pboyle.bsky.social Business Inquiries ➡️ sponsors@onfinance.org Patrick Boyle On Finance Podcast: Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313 Google Podcasts: https://tinyurl.com/62862nve Join this channel to support making this content: https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join Learn more about your ad choices. Visit megaphone.fm/adchoices

Showing 141–158 of 158 episodes