The continuous compounding section resonates with my technical analysis work - it's amazing how these fundamental principles show up in market behavior every day. Looking forward to Part 3!
Yes that was a typo, it should be 1 + r. I can't find it. Can you link the section?
CF (cash flow) is indeed equivalent to FV (future value). The term cash flow is often used in finance to describe the actual monetary value of a payment expected in the future, while future value emphasizes its position in time.
Iβm confused by the PV example where r=6%. The denominator is shown as (10.06)^n. I understand .06 is 6% expressed as a decimal. Where did the 10 come from?
Thank you. I realize what the problem is. Substack is rendering LaTeX on mobile and in emails wrong, but correctly on desktop. I will escalate it to the support team. thank you so much for pointing this out!
The continuous compounding section resonates with my technical analysis work - it's amazing how these fundamental principles show up in market behavior every day. Looking forward to Part 3!
Thanks so much! I've already written it!
Also the article states PV = CF / (1r)^n but when searching this formula I see PV = FV / (1+r)^n
I presume CF==FV here but why 1r in your example but 1+r in search results?
Yes that was a typo, it should be 1 + r. I can't find it. Can you link the section?
CF (cash flow) is indeed equivalent to FV (future value). The term cash flow is often used in finance to describe the actual monetary value of a payment expected in the future, while future value emphasizes its position in time.
Thanks a lot for correcting me!
Appreciate the quick reply Jack,
Iβm referring to the formula screenshots/graphics.
For example, immediately after this text:
βPresent Value Formula
To calculate the present value (PV) of a future cash flow (CF) occurring in n periods:β
I think the 1r vs 1+r is perhaps an issue in various formula graphics, maybe an issue with how they are generated?
Hmm, I'm seeing 1 + r and I'm using the in-built LaTeX Substack module to generate these.
Iβm confused by the PV example where r=6%. The denominator is shown as (10.06)^n. I understand .06 is 6% expressed as a decimal. Where did the 10 come from?
That is why (10.06)^n and not (.06)^n ?
Thanks for the math lesson here.
it's 1 + 0.06 = 1.06 which equals 106%. Are talking about the same example?
thanks.
Yes, the formula graphics.
It would he helpful if you could take a screenshot and upload it to imgur.com and paste the image url here. thank you!
Here is an image of the same issue/question from lesson 3: https://imgur.com/a/zBVmrd0
Thank you. I realize what the problem is. Substack is rendering LaTeX on mobile and in emails wrong, but correctly on desktop. I will escalate it to the support team. thank you so much for pointing this out!
all the best!
Jack