Stock Options, Brownian Motion, Finance, Black-Scholes formula, Central Limit Theorem, Private Valuation
Applied Mathematics | Finance and Financial Management
The Black-Scholes formula is fundamental to modeling carried out in the financial world. Black-Scholes presents investment bankers a method of evaluating a stock in order to know how much to charge for a premium when dealing with options; a way of selling and/or buying securities at a predetermined time in the future. Understanding how Black-Scholes and options theory work relies on understanding probability, statistics, and Brownian motion. these tools make it possible for Black-Scholes to do its dirty work.
Department 1 Awarding Honors Status
Krumme, J. P. (2005). Black-Scholes and Monetary Black Holes (Undergraduate honors thesis, University of Redlands). Retrieved from https://inspire.redlands.edu/cas_honors/106
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