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YouTube T4-08: Binomial tree option price: American-style

Nicole Seaman

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An American-style option allows for early exercise; therefore, it must be worth more than the equivalent European option. To price the option with the binomial, we only need to modify the non-terminal nodes so that their value equals Max (expected discounted value, intrinsic value).

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

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Hello David,

I am a student in Actuarial Science;
Your video on Binomial tree option price: American-style (FRM T4-8) is fantastic!
Do you mind assisting in the event that it's a Bermudan put option that can be exercised mid-way through the year and at maturity?
What are the changes required in the formula?

Thank you