Option Pricing

Annotated Bibliography

1
J. Barraquand and T. Pudet.
Pricing of American path-dependent contingent claims.
Mathematical Finance, 6(1):17-51, 1996.

Comprehensive theoretical analysis of pricing path-dependent derivatives. Introduce Forward Shooting Grid numerical technique.

2
H. Ben Ameur, M. Breton, and P. L'Ecuyer.
A numerical procedure for pricing American-style Asian options.
Technical Report G-99-39, GERAD, 1999.

Formulate the problem of pricing Asian options as a dynamic programming problem.

3
M. Broadie and P. Glasserman.
Estimating security price derivatives using simulation.
Management Science, 42(2):269-285, 1996.

4
D. P. Leisen.
Pricing the American put option: A detailed convergence analysis for binomial models.
Journal of Economic Dynamics and Control, 22:1419-1444, 1998.

Theoretical and numerical investigation of the convergence of different binomial models for American put option pricing. Introduction of a new method for decreasing initial errors.

5
F. Longstaff and E. Schwartz.
Valuing american options by simulation: A simple least-squares approach.
The Review of Financial Studies, 14(1):113-147, 2001.

Least Squares Monte Carlo approach for pricing options with American-style exercise opportunities. Examples of application to a wide variety of options.

6
P. Wilmott, S. Howison, and J. Dewynne.
The Mathematics of Financial Derivatives.
Cambridge University Press, Cambridge, 1995.

Introductory text on financial derivatives. Options and option pricing, numerical methods, exotic options and bonds.

7
R. Zvan, P. Forsyth, and K. Vetzal.
Robust numerical methods for PDE models of Asian options.
Journal of Computational Finance, 1:39-78, 1998.



Alexander Nicholson
2001-10-16