id	author	title	date	pages	extension	mime	words	sentences	flesch	summary	cache	txt
work_ufsmtfsdlzbnrnnc6u6dwtacgq	Jim Weatherall	The Peculiar Logic of the Black-Scholes Model	2018	16	.pdf	application/pdf	5547	405	61	The Black-Scholes(-Merton) model of options pricing establishes a theoretical relationship known as options on some underlying asset.1 From this model, one can derive a formula, known as the Black-Scholes formula, relating the theoretically "fair" price of an option to 1I will return to the details of the BSM model below, including a discussion of what an "option" is. a history of these ideas, including a discussion of the origins of the BSM model, see Weatherall (2013) and background on options and the BSM model, including a discussion of the assumptions in volatilities deduced from market prices of all options with the same underlier and Nevertheless, traders everywhere use implied BSM volatilities to quote options prices. Indeed, one could accept all of the assumptions of the BSM model, but take the volatility smile to show that market participants trading options with different parameters tend to have BSM model despite the volatility smile. Black-Scholes and Beyond: Option Pricing Models.	./cache/work_ufsmtfsdlzbnrnnc6u6dwtacgq.pdf	./txt/work_ufsmtfsdlzbnrnnc6u6dwtacgq.txt