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What is it for: Calculates the theoretical price of an option using the Black-Scholes model.
How it works: It calculates the value of the option taking into account various factors such as the strike price, the time remaining and the volatility.
Calculation: Use the Black-Scholes model to determine the value of a call or put option.
Usage: Essential for options investors to determine whether an option is overvalued or undervalued.
Formula: Depends on the Black-Scholes model (combination of variables such as the current asset price, strike price, volatility, etc.)
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