Pricing of Asian Options on Tesla Based on BSM model

Abstract

Due to the interaction of the changes in the world political situation and the influence of the global epidemic, the world economy has entered a period of instability and turmoil. This can be an opportunity for people who would like to make an investment. However, without adequate research and good preparation, they may face huge losses. Therefore, this research shows how to choose a reasonable investment approach for a particular market. To be more specific, the research topic of this paper is to show how Asian put options work well in Tesla Market, and the methods of this study include the BSM model, sensitivity analysis, and making a comparison of the Asian options with the European options. Then, the results could be seen that the Asian options will be a more affordable and less risky investment strategy for the Tesla market which is a market with high volatility. Thus, to invest in a market in the current society, it is better for investors to make a clear understanding of their target income and then make multifaceted research. As a result, the investor could reduce their unnecessary losses.