Workplace reviews and discussion: 群益金鼎證券股份有限公司

It happens every day without fail! The results from the previous batch of experiments still aren’t out, the daily optical-disc deliveries have turned my hair gray, and every day I try to find someone but can’t find anyone. This problem is only now starting to seem meaningful

“Determining the Extreme Value of the Cross-Period Net Economic Utility at Year-End Settlement, Including Cookie Consumption”

An investor conducted a year-end settlement in 2024 and adopted the following criteria as the evaluation standard:

Year-end settlement objective function =

Financial book profit and loss

Foreign-exchange effects

− Present-value expenditures for life events

− Monetary equivalent of utility losses

± Marginal-utility adjustment for cookie consumption

I. Financial Positions (Full Calculation Required)

(I) Futures

The investor holds 2 long Taiwan Stock Index Futures contracts

Contract multiplier: 200

Opening index: 15,750

Year-end settlement index: 16,180

Margin as a percentage of notional value: 12%

Annualized funding cost: 3.5%

The opportunity cost of margin is calculated using continuous compounding

(II) Warrants (Underlying Asset Without Dividends)

European call warrant

Current underlying-asset price: 102

Strike price: 100

Time to expiration: 1 year

No dividends

Risk-free interest rate: 2% (continuously compounded)

Volatility: 28%

Recognized at year-end using the Black–Scholes theoretical price

The number of warrants is configured so that Delta is not 0 (not Delta-neutral)

(III) Currency Position

At the beginning of the year, 120,000 USD was purchased at 29.8 TWD/USD

Year-end exchange rate: 31.4

No interest accrued throughout the year

Foreign-exchange profit or loss must be adjusted for an inflation rate of 1.5%

II. Life Events (Included in the Year-End Settlement After Discounting)

(I) Marriage

Married mid-year

One-time expenditure: 1,350,000 TWD

Psychological discount rate: 3%

(II) Having a Child

Born at year-end

Expected expenditure period: 22 years

Real annual expenditure: 320,000 TWD

Expenditure growth rate: 1%

Discount rate: 2%

(III) Loss of Life Utility

Caused by investment and work-related stress

Insufficient sleep: utility loss equivalent to 90,000 TWD

Fewer movie outings: utility loss of 45,000 TWD

Fewer all-you-can-eat meals: utility loss of 35,000 TWD

III. Cookies (Core Difficulty)

The investor consumed a total of 480 cookies during the year

Price per cookie: 35 TWD

Cookies are a form of immediate-pleasure consumption

The marginal utility function of cookies is:

Marginal utility = 1200 / square root of n

where n is the cumulative number of cookies already consumed

When marginal utility is less than 35, that portion of consumption is regarded as overconsumption

The utility corresponding to overconsumption must be included

The utility loss multiplied by a penalty coefficient of 0.6 is used as the year-end settlement adjustment item

IV. Question

After fully incorporating all financial profits and losses, foreign-exchange adjustments, the present value of life events, utility losses, and the marginal-utility adjustment for cookies, which of the following is closest to the investor’s “adjusted net economic effect after year-end settlement” for 2024?

Options (only one correct)

A. Positive 2,800,000 TWD

Financial operations were highly successful, and cookie consumption remained within the range of rational consumption

B. Positive 1,050,000 TWD

Financial gains were substantial, but having a child and cookie consumption significantly eroded the results

C. Negative 650,000 TWD

There was a book profit, but the year-end settlement showed a substantive loss

D. Negative 2,300,000 TWD

Highly leveraged financial operations, long-term life expenditures, and excessive cookie consumption caused the overall economic situation to deteriorate