Author

David Harris

Date of Graduation

2014

Document Type

Dissertation

Degree Type

PhD

College

College of Business and Economics

Department

Economics

Committee Chair

Ashok Abbott

Committee Co-Chair

Stratford Douglas

Committee Member

Harumi Hattori

Committee Member

Gerald Hobbs

Committee Member

Santiago Pinto

Abstract

The study of option pricing has a very short history, when compared with other elements of economics. Since the publication of a method to price European style equity options by Fischer Black and Myron Scholes in 1973 a vast amount of research on option pricing has occurred. Ultimately, the pricing of equity options depends upon the match of the model and reality. A new method to price option contracts is proposed. It is argued that the distributional assumptions of standard models are uncorrelated with nature. A new model is proposed as a start to a new class of models.

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