A quick look at the two main ways to price options
This is based on the idea that prices can go up or down. From that simple start, and using the ability to lend and borrow, we can determi...
The binomial solves for the price of an option by creating a riskless portfolio.
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"In an arbitrage-free world, if we have to create a portfolio comprising of these two assets (call option and underlying stock) such that...
In finance, the binomial options pricing model (BOPM) provides a generalizable numerical method for the valuation of options. The binomia...
The Black-Scholes or Black-Scholes-Merton model is a mathematical model of a financial market containing derivative investment instrument...
A look at how much a call option is worth at expiration. Includes payoff diagrams. Introduction to financial derivatives
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Below I will show you how to apply the Black-Scholes formulas in Excel and how to put them all together in a simple option pricing spread...
Below are some examples of option calculators...most sites will allow you to do either Black-Scholes or Binomial
MITI's Binomial Calculator is an easy tool that can calculate the fair value of an equity option based Binomial Models along with the Gre...
Thanks to Drexel, you can also calculate all of the greeks :)
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