Table 4

PAIRED-COMPARISON T-TEST RESULTS OF EURODOLLAR CALL

FUTURES OPTION APPROXIMATION METHODS

Panel A: Training Data Set

   

CGANN vs. Market Price

CGANN vs. CCS

Sample Group

N

t-statistic

p-value

t-statistic

p-value

Complete

Sample

2000 0.000 1.000 -28.669 0.000

M* > .01

790 -0.270 0.787 -22.606 0.000

.01 < M < 1

517 -0.629 0.530 -17.570 0.000

M > 1

271 0.549 0.583 -15.495 0.000

M < -.01

1202 0.147 0.883 -18.833 0.000

-1 < M < -.01

577 0.580 0.562 18.155 0.000

M < -1

619 -0.523 0.601 -11.105 0.000

-.01 < M < .01

8 0.969 0.365 -2.256 0.030

Panel B: Holdout Data Set, HOLDOUT1

Complete

Sample

6887 1.001 0.317 -52.206 0.000

M* > .01

2698 -0.654 0.513 -41.540 0.000

.01 < M < 1

1782 -1.457 0.145 -32.524 0.000

M > 1

910 1.027 0.305 -28.400 0.000

M < -.01

4159 2.126 0.034 -34.191 0.000

-1 < M < -.01

1840 1.899 0.058 -32.327 0.000

M < -1

2312 0.888 0.375 -20.335 0.000

-.01 < M < .01

30 0.609 0.547 -4.104 0.000
* M is a measure of the degree of moneyness, CGANN and CCS are the Genetic Adaptive Neural Network and Chen & Scott (1993) approximations, respectively. When comparing CGANN to the market price, the p-value is for a 2-tailed test. When comparing CGANN to CCS, the p-value is for a 1-tailed test.

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