Yalincak, Orhun Hakan (2005): Criticism of the BlackScholes Model: But Why Is It Still Used? (The Answer Is Simpler than the Formula).

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Abstract
The Black Scholes Model (BSM) is one of the most important concepts in modern financial theory both in terms of approach and applicability. The BSM is considered the standard model for valuing options; a model of price variation over time of financial instruments such as stocks that can, among other things, be used to determine the price of a European call option. However, while the formula has been subject to repeated criticism for its shortcomings, it is still in widespread use. This paper provides a brief overview of BSM, its foundational underpinnings, as well as discusses these shortcomings visàvis alternative models.
Item Type:  MPRA Paper 

Original Title:  Criticism of the BlackScholes Model: But Why Is It Still Used? (The Answer Is Simpler than the Formula). 
English Title:  Criticism of the BlackScholes Model: But Why Is It Still Used? (The Answer Is Simpler than the Formula). 
Language:  English 
Keywords:  BlackScholes model, finance, financial modeling, financial theory, volatility, option pricing, 
Subjects:  C  Mathematical and Quantitative Methods > C0  General C  Mathematical and Quantitative Methods > C0  General > C00  General C  Mathematical and Quantitative Methods > C5  Econometric Modeling C  Mathematical and Quantitative Methods > C5  Econometric Modeling > C50  General D  Microeconomics > D0  General D  Microeconomics > D0  General > D00  General E  Macroeconomics and Monetary Economics > E0  General > E00  General E  Macroeconomics and Monetary Economics > E0  General > E03  Behavioral Macroeconomics G  Financial Economics > G1  General Financial Markets G  Financial Economics > G1  General Financial Markets > G10  General 
Item ID:  63208 
Depositing User:  Mr. Orhun Hakan Yalincak 
Date Deposited:  26 Mar 2015 05:24 
Last Modified:  26 Sep 2019 13:25 
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URI:  https://mpra.ub.unimuenchen.de/id/eprint/63208 