## Formula

`C = N(d1) × S − N(d2) × Xe−r`

## How do I calculate the black scholes model ?

In order to calculate the Black-Scholes model, it is important to understand the variation in financial instruments. The value of an option can be determined by using the following formula:
```
C = N(d1) × S − N(d2) × Xe−rT
```

where C is the option price, S is the current price of the underlying asset, X is the strike price, r is the risk-free rate, T is the time to maturity, and N(d1) and N(d2) are the cumulative standard normal distribution functions of d1 and d2 respectively.
To help calculate this model, programs such as Sourcetable can be utilized to ensure accuracy.

## What is the Black-Scholes model?

The Black-Scholes model is a widely used method for pricing options, a type of derivative security. It is used to calculate the theoretical value of derivatives based on a variety of factors such as the current price of the underlying asset, the time remaining until expiration, the volatility of the underlying asset, and the risk-free rate of return.

## What factors does the Black-Scholes model take into account?

The Black-Scholes model takes into account the current price of the underlying asset, the time remaining until expiration, the volatility of the underlying asset, and the risk-free rate of return.

## What is the formula for the Black-Scholes model?

The formula for the Black-Scholes model is:

`C = SN(d1) - Ke`^{-rT}N(d2)

where:

`C`

is the estimated value of the option

`S`

is the current price of the underlying asset

`K`

is the strike price of the option

`r`

is the risk-free rate of return

`T`

is the time remaining until expiration

`N(d1)`

and `N(d2)`

are the cumulative normal distribution functions of `d1`

and `d2`

, respectively.

## Key Points

## How do I calculate black scholes model ?

`C = N(d1) × S − N(d2) × Xe−r`

## Determining Price

The Black-Scholes model uses six variables to determine the price of a European call option. These variables include volatility, type of option, underlying stock price, time, strike price, and risk-free rate.

## European Call Option

The model is used to calculate the price of a European call option. This option is a type of financial derivative that gives the buyer the right, but not the obligation, to buy the underlying asset at a specified price by a specified date.

## Put Option

The Black-Scholes model is also used to calculate the price of a put option. This option gives the buyer the right, but not the obligation, to sell the underlying asset at a specified price by a specified date. This option can be sold for more than the Black-Scholes calculated value.