Options & Derivatives
Options and derivatives are complex financial instruments used in various trading and investment strategies. An option gives the holder the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specific time frame. Derivatives, including futures, forwards, swaps, and options, derive their value from the performance of an underlying entity like an asset, index, or interest rate. These instruments are used for hedging against price fluctuations in an asset, thereby reducing risk, or for speculative purposes to profit from anticipated price movements. They play a crucial role in financial markets by providing additional liquidity, enabling price discovery, and offering mechanisms for risk management.
Forward Contracts Explained: How-To Value Them
Forward Rate Agreements Explained | How to Calculate an FRAs Value
Cross Hedging Explained: Find Optimal # of Futures Contracts
Basis Risk Explained Simply | Hedging Strategies
Put-Call Parity in Options Trading Explained Using Excel
Black-Scholes in Python: Option Pricing Made Easy
What is the Binomial Option Pricing Model?
Log Returns in Finance: Continuous Compounding and Euler’s Number (e) Explained
Step-by-Step Guide: Implementing the Black-Scholes Model in Python
https://youtu.be/Svmu_O6MH-4 In the world of finance, the Black-Scholes-Merton model stands out as a pivotal tool for pricing options. Developed through rigorous mathematical derivations, this model calculates the theoretical value of an option based on five essential parameters: With these components in mind, let’s dive into the implementation in Python: Step 1: Import Necessary Libraries Before […]
Hire me for your next Project
I can assist you with your financial modeling and quantitative finance projects, leveraging my expertise and experience in the field.