\input zb-basic
\input zb-matheduc
\iteman{ZMATH 2015c.00924}
\itemau{Orosi, Greg}
\itemti{A simple derivation of risk-neutral probability in the binomial option pricing model.}
\itemso{Int. J. Math. Educ. Sci. Technol. 46, No. 1, 142-147 (2015).}
\itemab
Summary: The traditional derivation of risk-neutral probability in the binomial option pricing framework used in introductory mathematical finance courses is straightforward, but employs several different concepts and is is not algebraically simple. In order to overcome this drawback of the standard approach, we provide an alternative derivation.
\itemrv{~}
\itemcc{M45 K55 K65}
\itemut{derivative; arbitrage-free pricing; option pricing; risk-neutral probability}
\itemli{doi:10.1080/0020739X.2014.936979}
\end