calculating N(d1) or N(d2)

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September 12, 2014 at 11:52 am #194737
student07
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Sir could u pls help me with call option or put option while calculating why do we someting subtract standard deviation from 0.5 and sometime we add to 0.5. Thanks
September 12, 2014 at 12:56 pm #194755
John Moffat
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The rule is given at bottom of the normal distribution tables in the exam, and I go through it in my free lecture on here.
You will not be asked why we do it (although it is to find the probably of being in excess of something – a bit like we do in value at risk).
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