Compare the equation for futures to BlackScholes with a constant, continuous dividend yield. How might we price
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Compare the equation for futures to Black–Scholes with a constant, continuous dividend yield. How might we price options on futures if we know the value of an option with the same payoff with the asset as underlying?
Consider Black–Scholes with a constant, continous dividend yield D = r.
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A futures option delivers one futures contract So if y...View the full answer
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The dividend yield or dividend–price ratio of a share is the dividend per share, divided by the price per share. It is also a company\\\'s total annual dividend payments divided by its market capitalization, assuming the number of shares is constant. It is often expressed as a percentage.
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