medium · Quantitative Finance stochastic
Which numéraire is implicitly used when we state that the T-forward price of an asset is a martingale?
- A zero-coupon bond maturing at time T, denoted P(t, T)
- The money-market account B_t, which grows at rate r
- The stock price S_t of the underlying asset
- A portfolio containing every risky asset traded in the market
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