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anjoazul
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Posts: 17
Joined: June 18th, 2017, 4:42 pm

What is the approach for the option pricing in real-world transaction

October 11th, 2021, 10:07 pm

As the BS formula is not that useful in the real-world transaction for the option pricing. I want to know, in the daily transaction, what are the realistic approach the traders are employing to calculate the price of options. Thanks!
 
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bearish
Posts: 6726
Joined: February 3rd, 2011, 2:19 pm

Re: What is the approach for the option pricing in real-world transaction

October 12th, 2021, 1:02 am

The formula is totally useful, not to mention used. You just need to know what volatility to use.