I watched this video and loved the way he decompose complexity into naturally simple problem. Concise, accurate and easy to explain to myself later.
vvishwakarma
Finally an intuitive and straight to the point explanation for BSM formula. Congratulations!!!
alevitorino
This has to be the best explanation for Black Scholes model! Thanks so much! Will be trying to re-create your excel!
finalpurez
Aaaamazing! I've seen this formula so many times, and this explanation is the best!
ammonshumway
I love it when you walk us through with concrete examples
서희수-rd
Legend. Gave me the 'click' moment in my head. Thank you!
entertainity
Very simply and clearly explained. Thanks. Please add more such videos especially on interest rates modeling
surendrabarsode
According to the example N(d1) and N(d2) are same - how to reconcile with BS
saumitrabhaduri
In case any one wondering conversion LOGNORMDIST to prob value, the prob value is LND (S2)- LND (S1).. i.e. subtract lower
Quantpie, please confirm if that's valid approach.
अंतुबर्वा
Best to watch before I head into the difficult textbook
monicatian
Is there a specific term referring to a call whose strike price is an equal distance between the share price and the "breakeven" price?
commonmancrypto
Worth pointing out that it is the mean of the log return, not the mean of the stock price?. Seems obvious, but not always clear.
stonecastle
Another channel on YT mentioned that if we assume the risk-free rate = 0 (implies random walk), then we shouldn't include the σ²/2 part into the drift calculation, instead, just zero out the whole drift calculation. In this case (according to the formula you give), m should be = ln S₀ - 0.
Why was his equation different than yours even when you both assume risk free rate = 0?
FenderAddict
I never understood black scholes until this video
spice
isn't at money option delta should be 0.5?
mattl
can I know why the mu is InS0 -0.5 *variance *T ?
thanks
abcchanaskh
Your calculation assumes that N(d1)=N(d2), as you are using the same probabilities to calculate the sums. This is not right. N(d1) is always greater than N(d2). The two probabilities are never the same.
hit
Hi, I could not calculate the number as your. Could you share the excel file of the prob. for me (if have ) ? thanks a lot
