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How to remember the Black-Scholes-Merton assumptions : CFA 6/21/17, 00:17

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Level 2 How to remember the Black-Scholes- search

31 Merton assumptions
submitted 1 month ago by ju2tin Level 2 Candidate
this post was submitted on 10 May 2017
Black, Scholes, and Merton were not just finance
guys. They were also a three-man motorcycle 31
gang, and they would REV their engines so hard points
(97% upvoted)
that their bikes would FLY away:
Risk-free rate constant & known shortlink:

European options
Volatility of asset returns constant & known
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Yield (continuously-compounded) on asset is
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When you remember this on the test because of
three finance professors on flying motorcycles,
you'll thank me. :-)
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[] karshokr Level 3 Candidate 6 points 1 month ago
Days Until CFA Exam
Heads-up to Level 2 Candidates: you do NOT need to
know the actual formula and they won't ask you to Changes to curriculum 2017
manipulate the equation or calculate anything to do with
Level 1
the BSM, just assumptions as you mentioned.
Level 2
I only found this out weeks before the L2 exam and wow Level 3
what a relief.
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[] SnazzleSauce Level 3 Candidate 2 points 1 month ago

Also that d(1) is delta iirc. And they ask about the Please follow these rules while using this
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No attempts at redirecting discussions to
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[] ju2tin Level 2 Candidate [S] 3 points 1 month ago
Avoid the use of anxious tones in posts
Right, of course you have to know the Greeks related to testing
and how they affect BSM inputs; that's its own
Changes to curriculum 2017
Read the Reddiquettes
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How to remember the Black-Scholes-Merton assumptions : CFA 6/21/17, 00:17

knowing the full BSM equation and sub-formulas

UpDown CFA
and using them to solve for option values.
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[] LoyalServantOfBRD Level 2 Candidate 2 points 1
month ago
< > discussions in r/CFA X
N(d1) is delta.
d1 is meaningless outside of its position in the offering Statistics and R Programming
standard normal distribution. Course
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[] postgradmess Level 2 Candidate 1 point 1 month ago

I saw the full Black Scholes on the Kaplan L2 cheat
sheets and wondered how the exam could possibly
ask us to manipulate such an equation with just our
financial calculator
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[] anaconda1189 Level 2 Candidate 6 points 1 month ago

This and "cow boys sing pretty" for put call parity are now
my favorites.
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[] Pho6 Level 2 Candidate 1 point 1 month ago

i'm definitely using this now!
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[] BrickTopp Level 2 Candidate 1 point 1 month ago

This is awesome. Thanks.
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