Risk-Neutral Pricing Model (Binomial Model)
Calculation Results
| Parameter | Value |
|---|---|
| Calculated Option Price ($) | |
| Up Factor (u) | |
| Down Factor (d) | |
| Risk-Neutral Probability (p) |
About the Model:
The Binomial Option Pricing Model is a widely used method for valuing options. It assumes that the underlying asset's price can move to only two possible prices (up or down) during each discrete time step. The "risk-neutral" assumption simplifies calculations by allowing discounting future expected payoffs at the risk-free rate.