Myron Scholes

Myron Scholes is a Canadian-American economist and financial theorist who shared the 1997 Nobel Memorial Prize in Economic Sciences for the Black–Scholes options-pricing formula.

Black–Scholes model: A mathematical model for estimating the value of European options from asset prices, volatility, time, and interest rates. Scholes is best known for co-developing this option-pricing model.
Fischer Black: An American economist and financial theorist who co-developed the Black–Scholes options-pricing model. Black was Scholes’s principal collaborator on the formula.
Options market: The market in contracts that give holders rights to buy or sell underlying assets at specified terms. The model made standardized valuation and trading of options more practical.
1997 Nobel Memorial Prize in Economic Sciences: The economics prize awarded to Robert C. Merton and Myron Scholes for a new method to determine the value of derivatives. This award recognized Scholes’s contribution to option-pricing theory.
Option (finance): A financial contract giving its holder the right, but not the obligation, to buy or sell an asset at a specified price. Options are the contracts whose valuation motivated Scholes’s most influential work.
Robert C. Merton: An American economist whose continuous-time finance research extended option-pricing theory and earned him the 1997 economics prize. Merton independently developed a related derivation and shared the Nobel recognition with Scholes.
Financial engineering: The use of mathematical methods to design, price, and manage financial products and strategies. Scholes’s pricing work became a foundation for engineering derivatives.
Black–Scholes equation: A partial differential equation governing the value of a European option under the Black–Scholes assumptions. The equation formalizes the pricing framework associated with Scholes’s work.
Arbitrage: Trading that exploits price differences between equivalent or closely related assets to seek riskless profit. The Black–Scholes framework uses replication and no-arbitrage reasoning to price options.
Eugene Fama: An American economist known for research on asset prices, market efficiency, and portfolio theory. Fama was Scholes’s doctoral adviser at the University of Chicago.

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