MTH359 Tutor-Marked Assignment 01

This assignment is worth 20 % of the final mark for MTH359 Applied Financial Mathematics I

Learning Outcome :

● Differentiate between the types of options: Puts & Calls, European & American.
● Compute the expected value of a financial contract using binomial tree model.
● Construct the Itô’s integral.
● Set up hedging strategies to minimise risks.
● Solve pricing problems with the application of Black-Scholes formula.
● Calculate the implied volatility for an option contract.