Lecture

Binomial Pricing and Replication

In course

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Description

This lecture covers the concepts of cash, forwards, options, and the one-period binomial pricing model. It explains how to replicate payoffs using a portfolio of cash, the underlying asset, and European call options. The lecture also delves into the interpretation of prices in a risk-neutral world and explores the implications of different states in the binomial model.

Instructors (2)

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Official source

https://mediaspace.epfl.ch/media/0_t5ic46av

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Ontological neighbourhood

Economics

Microeconomics: Financial economics

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