Extension of backwards 20.14 Induction Backwards induction can be used for some path-dependent options We will first illustrate the methodology using lookback options and then show how it can be used for Asian options Options, Futures, and other Derivatives, 5th edition 2002 by John C. HullOptions, Futures, and Other Derivatives, 5th edition © 2002 by John C. Hull 20.14 Extension of Backwards Induction • Backwards induction can be used for some path-dependent options • We will first illustrate the methodology using lookback options and then show how it can be used for Asian options