Actuarial Mathematics
The Black-Scholes Model is a mathematical model for pricing financial derivatives, particularly options. It provides a theoretical estimate of the price of European-style options based on factors such as the underlying asset price, strike price, time to expiration, risk-free interest rate, and volatility. This model is grounded in concepts like Brownian motion and diffusion processes, which are essential for understanding how asset prices evolve over time under uncertainty.
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