@the.synthetic.mind: In this video, we derive the Black-Scholes formula from first principles using the concept of replicating portfolios, showing why option pricing does not depend on expected stock returns. We build the intuition from a one-step tree up to continuous time, explain how dynamic hedging balances gamma risk against time decay, and examine both the Merton default model and where the formula breaks down in the post-1987 volatility smile. #BlackScholes #OptionPricing #QuantitativeFinance #AppliedMathematics

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The Synthetic Mind

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Region: CA

Tuesday 20 October 2026 15:45:45 GMT

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Robert Paulson :

This feels a lot like Las Vegas….

JamsStates :

You know he knows what he's talking about when he highlights implied volatility as the price instead of the bid or ask

twinArmegeddons :

amazing explanations, this was very understandable

Fiona :

This is a great explanation of something that can be scary to get into 🥰

gabriel🔥 :

the top and bottom values are arbitrary, buy everything widely accepted as dogma in economy becomes a self fulfilling prophecy 🤷 it's all so lame and tiring

Him_7 :

Can we zoom on auto calls ?

web3saas guy :

thanks thanks

slungbaddie :

amazing content as always

moch1bread :

great video

Jojo Emeka🇳🇬 :

First

maestrosphere :

Crazy that they published this when they could have used the infinite money glitch allowed by not pricing this way. Good for them

Buster Hymen-AKA Max Machismo :

Remember LTCM ❗️

dap7161 :

🙏🙏🙏

Walkin Lawton :

😳😳😳

sov_a :

😂😂😂

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