S&P 5005,218.73+0.34%|NASDAQ16,421.50+0.52%|DOW39,087.14+0.18%|GOLD2,348.60+0.71%|OIL78.42-0.63%|10Y4.28%-0.05%|BTC101,432.00+1.24%|AAPL198.36+0.41%|MSFT425.18+0.29%|NVDA882.54+1.87%|S&P 5005,218.73+0.34%|NASDAQ16,421.50+0.52%|DOW39,087.14+0.18%|GOLD2,348.60+0.71%|OIL78.42-0.63%|10Y4.28%-0.05%|BTC101,432.00+1.24%|AAPL198.36+0.41%|MSFT425.18+0.29%|NVDA882.54+1.87%|
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Options Pricing Lab

Black-Scholes-Merton Model + Greeks

The Concept

The Black-Scholes model prices options by computing the probability-weighted expected payoff under risk-neutral assumptions. It takes five inputs — stock price, strike price, time, risk-free rate, and volatility — and outputs a fair price. The Greeks measure how sensitive that price is to each input. This is the foundation of every options desk on Wall Street.

Parameters

$100
$100
0.25 yr (91d)
0.25 (25%)
0.050 (5.00%)

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The Trap Ledger

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