| Issue |
SHS Web Conf.
Volume 215, 2025
6th International Symposium on Frontiers of Economics and Management Science (FEMS 2025)
|
|
|---|---|---|
| Article Number | 01005 | |
| Number of page(s) | 4 | |
| DOI | https://doi.org/10.1051/shsconf/202521501005 | |
| Published online | 12 May 2025 | |
Option Pricing Models: A Study of the Black-Scholes-Merton Model
Master of management(finance), The University of Melbourne,
Melbourne
3010, Australia
* Kexuan Xue
Financial Derivatives refer to financial instruments whose value depends on or is derived from other underlying assets such as stocks, bonds, commodities, exchange rates, and interest rates Examples include futures and options. This paper first introduces the early theories of option pricing. It then focuses on the Black-Scholes model, discussing the academic modifications and expansions made to this model due to its theoretical assumptions not aligning with reality. These adjustments aim to explore more efficient and practical methods for calculating option prices.
Key words: Financial derivatives / Options / Asset pricing
© The Authors, published by EDP Sciences, 2025
This is an Open Access article distributed under the terms of the Creative Commons Attribution License 4.0, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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