how to make a calculator in excel for mac vba

Volatility is the most difficult parameter to estimate (all the other parameters are more or less given). Enter it also in dollars per share (it must have same units as underlying price, also with the same contract or lot multipliers). If you need more explanation, see: Strike vs.

Strike price, also called exercise price, is the price at which you will buy (if call) or sell (if put) the underlying security if you choose to exercise the option. Enter it in dollars (or euros/yen/pound etc.) per share. Underlying price is the price at which the underlying security is trading on the market at the moment you are doing the option pricing. Q?= continuously compounded dividend yield (% p.a.) R?= continuously compounded risk-free interest rate (% p.a.) When pricing a particular option, you will have to enter all the parameters in these cells in the correct format. Design cells where you will enter parameters.įirst you need to design six cells for the six Black-Scholes parameters.

If you are not familiar with the Black-Scholes model, its assumptions, parameters, and (at least the logic of) the formulas, you may want to read those pages first (overview of all Black-Scholes resources is here).īelow I will show you how to apply the Black-Scholes formulas in Excel and how to put them all together in a simple option pricing spreadsheet.

How to make a calculator in excel for mac vba