Replicate payoff put option rules


Replicate payoff put option rules


We will construct a replicating portfolio of the stock and a bond that has exactly the same payoff as the option. By no-arbitrage, the option must then rreplicate the same price as this replicating portfolio. I. Example II. Binom ial O ption Pricin g Model A. Binom ial Stoc k Prices B. One-P eriod Model C. Risk-N eutr al Pricing and Probab iliti es D. T wo-P erio d Model III. Dynami c Repli cation IV. Multi-P eriod Models A. Three-P eriod Model B.




Replicate payoff put option rules

Option rules put payoff replicate

Replicate payoff put option rules