10.3 Modeling stock prices >We can use any of the four types of stochastic processes to model stock prices The continuous time continuous variable process proves to be the most useful for the purposes of valuing derivative securities Options, Futures, and Other Derivatives, 4th edition@ 2000 by John C. Hull Tang Yincai, C 2003, Shanghai Normal UniversityOptions, Futures, and Other Derivatives, 4th edition © 2000 by John C. Hull Tang Yincai, © 2003, Shanghai Normal University 10.3 Modeling Stock Prices ➢We can use any of the four types of stochastic processes to model stock prices ➢The continuous time, continuous variable process proves to be the most useful for the purposes of valuing derivative securities