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Re: Rate Inputs to a piecewise Yield Curve

Posted by Luigi Ballabio on Jul 30, 2009; 10:40am
URL: http://quantlib.414.s1.nabble.com/Rate-Inputs-to-a-piecewise-Yield-Curve-tp7711p7714.html

On Thu, 2009-07-30 at 07:07 -0300, Piter Dias wrote:

> > E.g. 3M deposit rate of 7% (discount factor 0.983) followed by 6M
> > deposit rate of 3% (discount factor 0.985). Equivalent constraints
> > exist for zero rates, swap rates, FRA, etc
> >
> I didn't make the math, but you mean that, given two nodes, forward
> rates must not be negative (what makes a lot of sense) or forward
> rates must be greater or equal to the shortest node?

Non negative.

> What is the impact of changing the default in QuantLib (I mean, my
> change, not the QuantLib project default)?

Shouldn't be harmful, but in your shoes I'd run the test suite after the
change and see what happens.

Luigi


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I hate quotations.
-- Ralph Waldo Emerson



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