1.12 I of 3: The derivation of the Black-Scholes Differential Equation △S=μS△t+oS△ f 了f,102f △f=pS++ f S2△t+aS△z at aS We set up a portfolio consisting of 1: derivative f shares Options, Futures, and Other Derivatives, 4th edition@ 2000 by John C. Hull Tang Yincai, C 2003, Shanghai Normal University11.12 Options, Futures, and Other Derivatives, 4th edition © 2000 by John C. Hull Tang Yincai, © 2003, Shanghai Normal University 1 of 3: The Derivation of the Black-Scholes Differential Equation D D D D D D S S t S z S S t S S t S S z S = + = + +       + − m    m           ƒ ƒ ƒ ½ ƒ ƒ We set up a portfolio consisting of : derivative + ƒ : shares 2 2 2 2 1