A computational method for the European option price in an Internet of Things framework

摘要

In an Internet of Things (IoT) scenario, sensors and devices are able to: (ⅰ) extract information from real; (ⅱ) storage them into a database; (ⅲ) use this information for inferring results by the implementation of very efficient algorithms. In this paper we present a computational schema in which, in order to price financial European options, an IoT framework processes data, as financial assets, expiration day, interest rate, strike price. In particular, this procedure involves mathematical tools for the estimation of the volatility and for the calculation of the no arbitrage price. The mathematical model is translated into an algorithm that is implemented in a mobile software. To test its validity, we apply our schema to a real case.