Evolution of Real Estate Derivatives and Their Pricing

摘要: Real estate derivatives have the potential to stabilize one of most influential risks present in economies worldwide—real risk. Commercial and residential real represent a very large proportion wealth developed economies. In this article, authors revisit evolution these instruments describe state art modeling how they should be priced. The property market is still underdeveloped by comparison with its corresponding cash market, main reason commonly cited being lack flexible robust theoretical approaches that can easily applied practice. recent years, several models been proposed for pricing derivatives, article reviews important ones. addition, highlight discrete-time model set up employing Monte Carlo simulation. It reasonable expect expanding literature on valuation will provide framework needed grow.