Sign in
Non-uniqueness of option prices
Journal article   Peer reviewed

Non-uniqueness of option prices

Hans U Gerber and Elias S.W Shiu
Insurance, mathematics & economics, Vol.7(1), pp.67-69
1988
DOI: 10.1016/0167-6687(88)90098-4

View Online

Abstract

This note shows that, for a stock whose prices follow a general stochastic process, there may be infinitely many option-pricing formulas which are compatible with the stock prices and an assumed risk-free rate of return.
Binomial model Black—Scholes theory Option pricing

Details

Metrics