The best book you can buy if you really want to understand Black Scholes and other option pricing models but your're not quite a math wizard. Realistically, to understand these models, you need to understand the fundementals of calculus, statistics and probability, but the author manages to present the material in a way that is understandable without knowing the real heavy math. He glosses over some of the in-depth formal stuff (eg Ito's Lemma), but leaves the reader with at least intuitive sense of where the forumlae come from.

The best book you can buy if you really want to understand Black Scholes and other Models but your're not quite a math wizard. Realistically, to understand these models, you need to understand the fundementals of calculus, statistics and probability, but the author manages to present the material in a way that is understandable without knowing the real heavy math. He glosses over some of the in-depth formal stuff (eg Ito's Lemma), but leaves the reader with at least intuitive sense of where the forumlae come from.

Not being mathematically inclined, I had read a number of books over the years to understand equity derivative instruments such as options. Many of the other books out there can be either too mathematical or too "lite". This book provides the tools to clearly understand the underlying mathematics and models.
Like anything else, it requires some (limited) investment in time but pays this back. A book I recommend above all others to new colleagues.
Extremely useful for valuing options, including employee options. The introductory mathematical material and binomial model sections are especially valuable. While subject to important assumptions with associated uncertainty, the tools in this books are also helpful in understanding a number of more general corporate finance areas including private equity, venture capital, etc.
Very highly recommended. Go raibh mile maith aige.

I loved the way the author has started from Basic principles on Options and Mathematical concepts. This makes it a good option for newbies.

I loved the way the author has started from Basic principles on Options and Mathematical concepts. This makes it a good option for newbies.

This book was well written. It is easy to understand. I believe that it is especially helpful for anyone who wants to know more about option pricing.

This book was well written. It is easy to understand. I believe that it is especially helpful for anyone who wants to know more about option pricing.

I searched for hours trying to find a resource that would teach options pricing from a pure mathematical point of view. I read several "duds", but this one was a winner. The text focuses on the Black-Scholes theory in pure mathematical terms. This book is geared towards someone who has a solid math background (you are fluent with e^x, binomial trees and basic statistics). This also explained a lot of background concepts in options for the majority of us who don't do this for a living (put-call parity, differences between US and european options, implied volatility and hedging strategies). This book has opened my eyes to a lot of nuances in options pricing.

This book is challenging to read. To understand all the specifics, you have to read it slowly like you would a college textbook. Without studying every equation in detail, gaining a general "big picture" understanding of how and why the prices move gives you valuable insight to where a stock is headed. If you can evaluate the "theoretical price" of an option, and gain information explaining why the theoretical price differs substantially from the actual price (in some cases, the two are over 1000% apart), you can develop a more accurate risk-profile for that stock than the public, or profit from the mispricing of options.

This is one of the best books on quantitative finance and helps readers to develop an intuition of the subject, which is more important as this will help the reader to understand and apply finer points and prepares the base to build further

This book is extremely well written and very useful to me in that it provided the theoretical basis for option pricing. It also pointed out the theoretical limitations of Black Scholes and went on to discuss some of the later theories to improve option pricing. I obatined an Excel spreadsheet from a guy (Hoadley) in Australia which does all the mathematical details in the book plus a lot more. I'd recommend anyone interested get the book, and if you want to play with the numbers and concepts more you can with the spreadsheet functions. The theory presented in the book is more than enough though for most (I'm an engineer and like to understand why things work the way they do.) This book was one of the few that I made extensive notes in while reading it and tabbed the pages. I'd reveiw more specifics but a friend is presently reading it.

This book is extremely well written and very useful to me in that it provided the theoretical basis for option pricing. It also pointed out the theoretical limitations of Black Scholes and went on to discuss some of the later theories to improve option pricing. I obatined an Excel spreadsheet from a guy (Hoadley) in Australia which does all the mathematical details in the book plus a lot more. I'd recommend anyone interested get the book, and if you want to play with the numbers and concepts more you can with the spreadsheet functions. The theory presented in the book is more than enough though for most (I'm an engineer and like to understand why things work the way they do.) This book was one of the few that I made extensive notes in while reading it and tabbed the pages. I'd reveiw more specifics but a friend is presently reading it.

This book isn't about teaching you how to place an option trade and profit. Instead, it's about the mathematics behind option pricing model. I am a beginner in options trading and was looking for answers on how options get priced and what parameters affect the price. To be more precise, I was carious to know how the formula looks like. I learned from the book important things like Delta, Gamma, Vega parameters and their impact on pricing options.

This book isn't about teaching you how to place an option trade and profit. Instead, it's about the mathematics behind option pricing model. I am a beginner in options trading and was looking for answers on how options get priced and what parameters affect the price. To be more precise, I was carious to know how the formula looks like. I learned from the book important things like Delta, Gamma, Vega parameters and their impact on pricing options.

I picked up this book as additional reading for an actuarial exam on investments, in hopes of getting a better and more intuitive understanding of the Black-Scholes Formula. This book develops ideas in a clear, natural, intuitive sequence. I particularly commend the author for a lucid and agreeable style. I was expecting a book on this kind of subject to be dry and heavy-going, but instead what I found was a very good teacher guiding me through the subject. It should be mentioned that the development of the formula entirely from scratch is not in this book, as that would basically require stochastic calculus or other techniques beyond the scope of the book. Even so, he does explain the rationale behind the formula as well as related concepts such as hedging away risk and self-financing strategies. He gives the appropriate versions of the Black-Scholes Formula for stocks with continuous or lumpy dividends and, of course, talks about put-call parity for European options. There is excellent coverage of The Greeks (delta, gamma, vega, etc.) along with numerous graphs. A nice surprise was the inclusion of some approximation formulas for the cumulative normal distribution that can be calculated easily with a spreadsheet or calculator. Finally, he has very good coverage on binomial trees, of both the classic "Cox-Ross-Rubinstein" and the "flexible" varieties. I have to admit that I have read only through Ch. 7 so far (which is approx. 2/3 of the book), but I will probably keep going because it is so good.

Great book for practitioners in finance without cumbersome math formula!

Be careful with the typing errors which could be misleading
especially in many chapters in the late of the book.
Except that, it is really easy to read without much math
or computer background in the perfessional field.

If you wanna use the Black & Scholes formula to simply compute option values and nothing more, then that's not the book for you. However, if you are eager to understand the interesting and important part of option pricings theory (B&S and Binomial Tree)without dwelling into maths and understanding intuitively what makes it tick, then, you might have found the right book for you.

An outstanding book! It explains the mathematics underlying derivatives extremely well. The author's style is very clear and it is a pleasure to read.

I highly recommend this book!

This book well explains the probability and statistical methods used in Black-Scholes formula. As we know that Black-Scholes formula has several approaches to the evaluation of an option, and the approach taken in this book was vague. In this book not all the mathimatical elements of the Black-Scholes formula was explained. I would like to emphasize that this book would not help to understand the Black-Scholes formula completely.

Neil Chriss' book, "Black-Scholes and Beyond" is the first book that I have found that clearly presents the fundamental thinking behind the Black-Scholes formula and all of the underpinning assumptions. I have looked long and hard for a book that can present to an interested and mathematically-adept reader a clear picture of the origin of the BS-formula. Books like Hull are poorly written and confusing to the uninitiated. Chriss, however, presents a logical case for the derivation of the BS-formula which has left me with an understanding of its ingredients and limitations. To flesh-out the BS limitations, Chriss presents 6 chapters on pricing options on Binomial Trees. Chriss' exposition presents trees as an alternative and powerful tool for the valuation of European, American, and exotic options. Trees are treated as a superset of tools to Black-Scholes and moreover as field of their own. The extensive bibliography has helped me track down journal articles on various related subjects so that I can further study the material.

Chriss presents a wealth of intuitive explanations to pricing options - explanations that help the reader gain a greater understanding of the limitations and problems that the current methods face. Often it is hard to find a text that presents in detail the shortcomings of a method or technique, but as any researcher would know, understanding the current limitations is fundamental to advancing the state-of-the-art. In this respect, Chriss goes way beyond any textbook available today.

The reader will find detailed explanations on how to use the BS formula and how to build binomial trees. Additionally, there is extensive material on how to build implied binomial trees and implied volatility trees. I have taken the time to write code to reproduce the material in the chapters and thus far I have had little difficulty, although the last couple of chapters could use a bit of augmentation. Nonetheless, I've read this book twice.

Chriss has done an outstanding job at presenting the material. I look forward to future revisions of this current book and to additional books that I hope he will write. Chriss has created a new standard in financial texts that I hope others adhere to.

This book is written, presumably, for the uninitiated reader, It explains some very simple ideas extensively and requires minimal mathematical background. I believe that the presentation could be improved by reducing the number of comments and using a more structured approach, like hypothesis-conclusion. In mathematical terms: theorem-proof. The explanation of probability notions is somewhat confusing. For example, the book mentions repeatedly the expectation of a "random event". What is really meant is the expectation of a random variable associated with that event. Since one event is associated with (possibly infinitely) many random variables this can cause confusion to the uninitiated. An event, for example "heads or tails", is not necessarily a numerical quantity. Expectation of "something" implicitly assumes that the "something" is a number. An explanation of the ergodic hypothesis, replacing ensemble (probability) averages with time averages, might be helpful. This remark pertains, for example, to the calculation of the volatility, which, in practice, is calculated from actual data of a time series. The book presents graphs of the (cumulative) normal distribution functions as "area" graphs on a chart of the normal density function. This is another notion that needs clarification, without necessarily using the notion of integral. I was looking for a book that provides a motivation for the Black Scholes formula. I am not an expert in the field, but I believe that the option price should be defined as some kind of "expected" value of the difference between stock price and strike price on the day of expiration. The approach of the book via a "self financing replicating strategy" is not intuitively clear. Very valuable features of the book are the comments at the end of each chapter and the extensive bibliography.