= Myron Scholes
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<Myron Scholes>, with <Fischer Black>, developed the <Black-Scholes model> and its <option pricing> equation. Their 1973 paper connects a contingent claim's value to the cost of a dynamically adjusted <replicating portfolio>, under explicit assumptions about trading and the underlying price process.<The Pricing of Options and Corporate Liabilities by Fischer Black and Myron Scholes>[1973, assumptions and derivation of the valuation equation]{ref}
The mathematical insight is that a carefully chosen hedge can cancel the instantaneous random component of the claim's value. <No-arbitrage> then constrains the remaining locally riskless return, producing the <Black-Scholes equation> together with a final payoff condition. The result is a conditional conclusion within a model: it does not require an ability to predict the actual stock-price path.<The Pricing of Options and Corporate Liabilities by Fischer Black and Myron Scholes>[Derivation of the differential equation and the boundary condition for a call]{ref}
Institutional profile: https://www.gsb.stanford.edu/faculty-research/faculty/myron-s-scholes
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{title=Portrait of <Myron Scholes>}
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