The Black-Scholes model is a mathematical model used to calculate the theoretical price of a European call or put option, named after its creators Fischer Black and Myron Scholes. The model was introduced in 1973 and has since become...

The Efficient Market Hypothesis (EMH) is a widely accepted financial theory that suggests that financial markets are "efficient" in the sense that they quickly and accurately incorporate all available information into asset prices. Developed in the 1960s by Eugene...

Modern Portfolio Theory (MPT), also known as mean-variance analysis, is a widely accepted investment theory that was developed by economist Harry Markowitz in the 1950s. The theory is based on the idea that investors can construct a portfolio of...

The Capital Asset Pricing Model, or CAPM, is a widely used financial model that helps investors determine the expected return on an investment, given its risk level. The model was developed in the 1960s by William Sharpe, John Lintner,...

Random Walk Theory is a financial theory that proposes that stock market prices evolve randomly over time, which means that there is no way to predict future stock prices based on past performance. The theory suggests that any new...