Skip to main content
SpringerLink
Log in

Binomial/Trinomial Tree Option Pricing Using Python

  • Chapter
  • First Online:
Essentials of Excel VBA, Python, and R

  • 1512 Accesses

Abstract

The Binomial Tree Option Pricing model is one the most famous models used to price options.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 149.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 129.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 199.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

References

  • Benninga, S. Financial Modeling. Cambridge, MA: MIT Press, 2000.

    Google Scholar 

  • Cox, J., S. A. Ross and M. Rubinstein. “Option Pricing: A Simplified Approach.” Journal of Financial Economics, v. 7 (1979), pp. 229–263.

    Article  MathSciNet  MATH  Google Scholar 

  • Jarrow, Robert, and Andrew Rudd. “A comparison of the APT and CAPM a note.” Journal of Banking & Finance 7.2 (1983): 295–303.

    Google Scholar 

  • Kamrad, Bardia, and Peter Ritchken. “Multinomial approximating models for options with k state variables.” Management science 37.12 (1991): 1640–1652.

    Google Scholar 

  • Lee, C. F., J. C. Lee and A. C. Lee (2000). Statistics for Business and Financial Economics. 3rd edition. Springer, New York, 2000.

    Google Scholar 

  • Leisen, Dietmar PJ, and Matthias Reimer. “Binomial models for option valuation-examining and improving convergence.” Applied Mathematical Finance 3.4 (1996): 319–346.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Center for PBBEF Research, Morris Plains, NJ, USA

    John Lee

  2. National Tsing Hua University, Hsinchu, Taiwan

    Jow-Ran Chang

  3. College of Finance, Takming University of Science and Technology, Taipei City, Taiwan

    Lie-Jane Kao

  4. Rutgers School of Business, The State University of New Jersey, North Brunswick, NJ, USA

    Cheng-Few Lee

Authors
  1. John Lee
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Jow-Ran Chang
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Lie-Jane Kao
    View author publications

    You can also search for this author in PubMed Google Scholar

  4. Cheng-Few Lee
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to John Lee .

Appendices

Appendix 16.1: Python Programming Code for Binomial Tree Option Pricing

figure l
figure m
figure n
figure o
figure p
figure q
figure r

Appendix 16.2: Python Programming Code for Trinomial Tree Option Pricing

figure s
figure t
figure u

Rights and permissions

Reprints and permissions

Copyright information

© 2023 The Author(s), under exclusive license to Springer Nature Switzerland AG

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Lee, J., Chang, JR., Kao, LJ., Lee, CF. (2023). Binomial/Trinomial Tree Option Pricing Using Python. In: Essentials of Excel VBA, Python, and R. Springer, Cham. https://doi.org/10.1007/978-3-031-14283-3_16

Download citation

Publish with us

Policies and ethics

Search

Navigation