Binomial Option Pricing Model
This project attempts to analyze the use of the Binomial Opting Pricing model in real life scenarios. The Binomial options pricing model approach is used in many situations and different sort of conditions when the other models of option pricing are not applicable or cannot be applied easily.The historical stock prices of the company, which have been used in the application of the Binomial Option pricing model for the call options,are for the Microsoft Corporation. The company’s stocks have been traded since 1980s however; the historical data has been used from the December of 1990 to December of 2014.The historical prices and the annual returns for each year from 1991 to 2014 could be seen in the excel spreadsheet. The graph for these annual returns and the descriptive statistics are as follows:
PERCENTAGE RETURNS
Mean 24.25%
Standard Error 8.70%
Median 15.84%
Mode #N/A
Standard Deviation 41.71%
Sample Variance 0.17393
Kurtosis 0.05855
Skewness 0.05087
Range 1.77451
Minimum -0.62848
Maximum 1.14604
Sum 558%
Count 23
This is just a sample partial case solution. Please place the order on the website to order your own originally done case solution.
Related Case Solutions & Analyses:
The FA-18 F404 Engine: Getting Lean (B)
Bladelogic (A)
Note on Mergers and Acquisitions and Valuation
Kinder morgan energy partners, l.p. Acquisition of copano energy, l.l.c
Whirlpool Europe
DonorsChoose.org: How Technology Facilitated a New Funding Model
Proximity Designs
Spss Assignment
Westmont Retirement
Mindy Harris
