Binomial Trees
This course focuses on an alternative method of implementing a two-dimensional binomial tree compared to the traditional method of building a binomial tree presented in most option pricing text books. The alternate approach is based on the techniques documented by Professor Mark Broadie at Columbia Business School as part of his coursework in Security Pricing and Computational Finance courses at Columbia University and allows us to extend a simple 3 step tree to a 50 – 100 step option pricing tree in a few minutes.
The course starts with pricing European calls and put options, followed by pricing American options and closes by reviewing option pricing for Knock out and Knock in (Sudden Death). We also review the special case of a down and in option.
Options Pricing – Using binomial trees to price options in a spreadsheet
Options Pricing – Pricing Call Options – Option pricing spreadsheet – Binomial trees
Options Pricing – Pricing Put Options – Option pricing spreadsheet – Binomial trees
Options Pricing–Exotics Options–Pricing a Capped Call–Binomial trees
Options Pricing – Pricing Knockout exotic options – Sudden Death Options – Down and out call options
Options Pricing – Binomial Trees – Pricing Sudden death Options – Down and in call options
If you would like to purchase and download the excel examples covered in this course, please checkout our online option pricing course store for handy pdf course cheat sheet downloads and solved excel spreadsheets and templates. If you need a option and derivatives product refresher, please see the introductory and intermediate courses below on Derivatives and Options products
- The Derivatives Short Course for Dummies
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Derivatives for Dummies – a first look at options and derivatives
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A quick look at basic concepts and vanilla options as well as synthetic manufacturing of options at a higher level of detail. The Derivatives for dummies crash course is followed by an intermediate level course that reviews product variation and basic pricing concepts.
Derivatives Training: Options and derivatives crash course: Terminology
Derivatives Training: Options and Derivatives Crash Course: Forward, Futures and Options
Derivatives Training: Options and Derivatives Crash Course: Payoff profiles – Forwards
Derivatives Training: Options and Derivatives Crash Course: Synthetics
Derivative products
The second course on derivatives and options products digs a little deeper into products, pricing, sensitivities and product variations over ten easy to read chapters. Starting again from vanilla products we touch upon options on currencies and Forex, options on interest rates, forwards, futures an Interest Rate Swaps.
Derivatives Training: Derivative Products: Review
Derivatives Training: Derivative Products: Vanilla products
Derivatives Training: Derivative Products: Pricing Basics
Derivatives Training: Derivative Products: Greeks and Binomial Trees
Derivatives Training: Derivative Products: Options on shares, stocks, currencies and equities
Derivatives Training: Derivative products: Exotic Options
Derivatives Training: Derivative products: Options on rates
Derivatives Training: Derivative Products: Forwards
