Black Scholes Merton Formula

Is black scholes covered in depth in the CFAI material? I’ve done the reading in schweser and it was rather brief… it also implied we won’t be tested on the formula itself. anyone?

It was on test last year!!

It was Treynor’s black which came last year and not BSM

oh ok. I wouldn’t know. Just read somewhere here. It’s my first attempt.

Even if it is, it’s not that tough of a formula to memorize or understand.

Why speculate when you can invest 30 seconds into looking up the LOS? LOS 64.c: explain the assumptions underlying the Black–Scholes–Merton model and their limitations; LOS 64.d: explain how an option price, as represented by the Black–Scholes–Merton model, is affected by each of the input values (the option Greeks); You clearly do not need to learn/memorize how to calculate a B-S ratio or its component parts . Just following the LOS… there are already enough calculations to learn without wasting your time on unnecessary items.

hiredguns, thanks. that is what i gathered from schweser and los… there was also this one line saying they used to require candidates to acutally calculate b/s but this year they wouldn’t be. so i guess i was asking whether they tested it last year. my cfa institute paranoia is intesifying as the test date gets nearer.

schweser notes 2008 says u dont need to memroize the formula… so dont worry too much i say