The model holds that only the present value of stock price is related to future forecast; The past history and evolution of variables have nothing to do with future prediction. The model shows that the decision of option price is very complicated, and the contract term, current stock price, interest rate level of risk-free assets and delivery price will all affect the option price.

Black Scholes option pricing theory is also called Black Scholes Merton option pricing model.

1997 10 June10, the 29th Nobel Prize in Economics was awarded to two American scholars, robert merton, a professor at Harvard Business School, and Myron Scholes, a professor at Stanford University. At the same time, it affirmed Blake's outstanding contribution.

The Black-Scholes option pricing model they founded and developed laid the foundation for the reasonable pricing of various derivative financial instruments in the emerging derivative financial market, including stocks, bonds, currencies and commodities.

In the early 1970s, Scholes and his colleague, the late mathematician fischer black, developed a complex option pricing formula. At the same time, Merton also found the same formula and many other useful conclusions about options. As a result, these two papers were published in different journals almost simultaneously. However, Merton didn't get the same reputation as the other two at first, but the names of Blake and Scholes are always associated with the model.

Therefore, Black-Scholes pricing model can also be called Black-Scholes-Merton pricing model. Merton expanded the connotation of the original model and applied it to many other forms of financial transactions. The Swedish Academy of Royal Sciences praised their research achievements in option pricing as the most outstanding contribution to economic science in the next 25 years.