Extended B-S Pricing Models Of European Option And Risk Control Management Of Options Trading

Option pricing has been the core problem in the financial market, especially the B-S pricing model and the B-S formula published, has drawn wide attention, and was gradually extended to the pricing of financial derivatives.This paper gives a mathematical model of the B-S option pricing, and by making the appropriate assumptions to establish the Mathematics differential equation to correspond the model; in order to get the B-S pricing formula, using the Ito lemma, heat conduction equations and related mathematical knowledge, to solve the B-S option pricing formula; under the actual financial markets, find out the point to improve the classic B-S pricing formula to modify the model and formula, and draw a variety of improvements of the B-S pricing formula in the versatile market, such as:paying dividends and transaction costs of option model and formula, the two value options and having jump-diffusion process of option model and formulas, under the environment of the fractional Brownian motion and the pricing formula.Then by using the generalized B-S formula and theory, analyse Hedge strategies during the options trading to reduce the market risk that may arise in the course of trading, and achieve the purpose of risk control. It states the common hedge management strategy, makes up specific examples to illustrate it, and evaluates the advantages and disadvantages of various strategies, including hedging techniques and the management of risk assets, finally, it expresses my own views on the research direction of the option pricing problem...