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Options-Pricing

Testing machine learning algorithms based on options features to see whether they are more accurate than Black-Scholes formula and creating a classifier to determine whether Black-Scholes will over- or under-estimate the price of the option.

Analysis Performed

In this project, I tested various algorithms such as XGBoost, Random Forest, Support Vector Machines, Decision Trees, Muliple Linear Regression, and Binomial Logistic Regression for different aspects of the prediction. I also feature engineered one feature and performed routine data pre-processing to make sure that the data that the analysis was performed on sound data.

Methods Used

  • Data Cleaning
  • Data Analysis
  • Exploratory Data Analysis
  • Descriptive Statistics
  • Data Visualization
  • Machine Learning
  • Statistical Analysis

Results

In this project, I achieved the highest score within the entire class with the combined accuracy of both of my models.

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Testing machine learning algorithms based on options features to see whether they are more accurate than Black-Scholes formula and creating a classifier to determine whether Black-Scholes will over- or under-estimate the price of the option.

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