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# YouTubeT3-35: Lower bounds for European stock option prices

#### Nicole Seaman

Staff member
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The lower bound for the price of a European call option is given by max[0, S(0) - K*exp(-rT) - D]. The lower bound for the price of a European put option is given by max[0, K*exp(-rT) - S(0) + D], where D is the lump-sum PV of the dividend. Where q is the continuous dividend, the lump-sum D= -S(0)*(EXP(-q*T)-1).

David's XLS is here: https://trtl.bz/2BYKn6P

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