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- Title
IN DEFENSE OF MODELS.
- Authors
Morris, Gregory D. L.
- Abstract
The article discusses the pricing model for financial options developed by U.S. economists Robert C. Merton, Fischer Black, and Myron Scholes, known as the Black-Scholes-Merton model. The history of asset pricing models in the 20th century is reviewed, as is the establishment in 1973 of the Chicago (Illinois) Board Options Exchange (CBOE) as an offshoot of the Chicago Board of Trade (CBOT). The gradual recognition in U.S. financial markets of options as a legitimate form of financial hedging is discussed, as is the success of the CBOE.
- Subjects
UNITED States; OPTIONS (Finance); MERTON, Robert C.; BLACK, Fischer; SCHOLES, Myron; PRICES of securities; CHICAGO Board Options Exchange; MATHEMATICAL models of option; SECURITIES industry; HISTORY
- Publication
Financial History, 2010, Issue 96, p32
- ISSN
1520-4723
- Publication type
Article