Louis Bachelier: The Father of Modern Option Pricing Theory.

Sullivan, Edward J.; Weithers, Timothy M.

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Peer reviewed

ERIC Number: EJ435006

Record Type: Journal

Publication Date: 1991

Pages: N/A

Abstractor: N/A

ISBN: N/A

ISSN: ISSN-0022-0485

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Louis Bachelier: The Father of Modern Option Pricing Theory.

Sullivan, Edward J.; Weithers, Timothy M.

Journal of Economic Education, v22 n2 p165-71 Spr 1991

Observes that, before 1973, determining a valuation formula for option prices was an elusive goal of financial economics. Discusses Louis Bachelier's early twentieth-century work on the problem. Notes that Bachelier derived a normal distribution for stock price movements by modeling price changes in specific way. Reviews Bachelier's option pricing equation. (SG)

Descriptors: Cost Indexes, Economic Research, Economics Education, Educational History, Free Enterprise System, Higher Education, Models

Publication Type: Journal Articles; Historical Materials; Reports - Evaluative

Education Level: N/A

Audience: Researchers

Language: English

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Authoring Institution: N/A

Grant or Contract Numbers: N/A

Author Affiliations: N/A