Fin Math L6-1: The Black-Scholes-Merton theorem

Welcome to Lesson 6 of Financial Mathematics.
This is the lesson of the Black-Scholes-Merton (BSM) theorem. Finally, you might say.
But it will also be the lesson of volatility and distortions. A lot of interesting things.
In this first video, we focus on the BSM theorem.

Topics:
00:00 Introduction
02:34 The appropriate Q measure
06:36 Options and replicating strategies
09:20 The BSM theorem with probabilistic proof