Trading options before Black-Scholes: a study of the market in late-seventeenth-century London
Murphy, Anne L
Date: 26 November 2007
Journal
The Economic History Review
Publisher
Wiley-Blackwell Publishing
Publisher DOI
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Abstract
This article uses data from the ledgers of the financial broker Charles Blunt to explore the
market in equity options that emerged in London during the stock market boom of the early
1690s. Blunt’s ledgers provide a unique opportunity to observe the workings of an early
modern derivatives market. They reveal a broadly based and highly ...
This article uses data from the ledgers of the financial broker Charles Blunt to explore the
market in equity options that emerged in London during the stock market boom of the early
1690s. Blunt’s ledgers provide a unique opportunity to observe the workings of an early
modern derivatives market. They reveal a broadly based and highly active trade in options.
The market functioned well, determined value using agreed criteria, and was utilised by a
diverse range of individuals to facilitate both risk-seeking and risk-averse investment
strategies.
History
Collections of Former Colleges
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