Consider a stock currently priced at $40. Assume that in each period of one month, the stock could either appreciate or depreciate by 10%. The risk-free rate is 2% per annum. What would be the value of a 3-month American lookback option on the minimum of this stock?

Answer rating: 100% (QA)

To calculate the value of a 3month American lookback option on the minimum of the stock we can use t... View the full answer