Commit 3f2847

2024-08-23 14:22:46 Stanislav Kubrak: SF Option Payoff draft v1
/dev/null .. sf option payoff.md
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+ # SF Option Payoff
+
+ Let's consider vanila call option.
+ The corresponding payoff looks as following:
+
+ $P_{vanila} = max(S-K,0)$
+
+ However Stochastic.Finance options have a bit of non-trivial payoff as a fraction of the supplied collateral:
+
+ $P_{SF} = \frac{P_{vanila}}{P_{vanila} + S} = \frac{max(S-K,0)}{max(S-K,0) + S}$
+
+ for every ETH supplied collateral, so that in case the collateral is 10 ETH the total payoff would be $P_{SF}$ * 10 ETH
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