Definitions for "Black-Scholes"
Keywords:  scholes, myron, fisher, fischer, nobel
A closed-form solution (i.e. an equation) for valuing plain vanilla options developed by Fischer Black and Myron Scholes in 1973 for which they shared the Nobel Prize in Economics. Call Option A call option is a financial contract giving the owner the right but not the obligation to buy a pre-set amount of the underlying financial instrument at a pre-set price with a pre-set maturity date.
The most widely used method of option valuation. More complex models are sometimes necessary as it uses a number of simplifying assumptions.... more on: Black-Scholes
A complex mathematical formula created by Fischer Black and Myron Scholes; used to calculate the theoretical present value of a stock option at the grant date using variables such as stock price, exercise price, volatility, and expected option term to exercise.