Financial Engineering

The Volatility Smile - Chapter 2 - The principle of replication

RIAGOL 2024. 3. 31. 03:05

https://symin.us/posts/financial_engineering/2024-03-29.html

 

Gloria - The Volatility Smile - Chapter 2 - The principle of replication

The law of one price: similar things must have similar prices Replication: the only reliable way to value a security A simple up-down model for the risk of stocks, in which expected return \(\mu\) and volatility \(\sigma\) are all that matter The Law of on

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