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Please explain why average strike call price always higher than average call price in above 4 situations. 1. Asian Option Prices 16 different option prices
Please explain why average strike call price always higher than average call price in above 4 situations.
1. Asian Option Prices 16 different option prices are calculated using Monte-Carlo simulation and displayed in the table below. Arithmetic (discrete) average price average strike call put call 6.61 3.10 7.04 3.04 6.59 put call average Arithmetic price (continuous) average strike put call 3.09 7.06 average price average strike Geometric (discrete) put call put call put call 3.04 6.36 3.20 7.28 2.93 6.34 3.19 7.30 average price average strike Geometric (continuous) put call put 2.94 1. Asian Option Prices 16 different option prices are calculated using Monte-Carlo simulation and displayed in the table below. Arithmetic (discrete) average price average strike call put call 6.61 3.10 7.04 3.04 6.59 put call average Arithmetic price (continuous) average strike put call 3.09 7.06 average price average strike Geometric (discrete) put call put call put call 3.04 6.36 3.20 7.28 2.93 6.34 3.19 7.30 average price average strike Geometric (continuous) put call put 2.94Step by Step Solution
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