Skip to main content Accessibility help
×
Hostname: page-component-7479d7b7d-68ccn Total loading time: 0 Render date: 2024-07-13T04:39:36.802Z Has data issue: false hasContentIssue false

5 - Option Pricing Theory

Published online by Cambridge University Press:  09 February 2017

Raghavendra Rau
Affiliation:
Judge Business School, Cambridge
Get access

Summary

Every summer in Cambridge, England, the Cambridge Shakespeare Festival puts on a series of plays in the college gardens. These are very popular with the audience, who bring their own chairs, blankets, and picnic baskets to watch Shakespeare in a gorgeous college garden. However, there is one big downside – the English weather. Buying the (non-refundable) tickets well in advance will reserve a place for you but, unfortunately, exposes you to the risk that it will pour down on the day of the performance, leaving you sitting on a sodden blanket watching a bunch of unhappy actors who would also rather be elsewhere. Not buying the tickets in advance, in contrast, exposes you to the risk that the weather will be gorgeous on the day but the show will be sold out (or that ticket prices rise too much for you to afford), leaving you on the road outside the garden, listening to the sounds of merriment and wishing you were inside.

Type
Chapter
Information
Publisher: Cambridge University Press
Print publication year: 2016

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Save book to Kindle

To save this book to your Kindle, first ensure coreplatform@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

  • Option Pricing Theory
  • Raghavendra Rau, Judge Business School, Cambridge
  • Book: Short Introduction to Corporate Finance
  • Online publication: 09 February 2017
  • Chapter DOI: https://doi.org/10.1017/9781316105795.006
Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

  • Option Pricing Theory
  • Raghavendra Rau, Judge Business School, Cambridge
  • Book: Short Introduction to Corporate Finance
  • Online publication: 09 February 2017
  • Chapter DOI: https://doi.org/10.1017/9781316105795.006
Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

  • Option Pricing Theory
  • Raghavendra Rau, Judge Business School, Cambridge
  • Book: Short Introduction to Corporate Finance
  • Online publication: 09 February 2017
  • Chapter DOI: https://doi.org/10.1017/9781316105795.006
Available formats
×