Myron S. Scholes

AAA

DEFINITION of 'Myron S. Scholes'

An American economist and winner of the 1997 Nobel Prize in Economics along with Robert Merton for their method of determining the value of stock options, the Black-Scholes model. (Fischer Black, the co-author of the Black-Scholes equation on which the model is based, died in 1995.) Scholes' research has also focused on taxation and incentives.

INVESTOPEDIA EXPLAINS 'Myron S. Scholes'

Scholes earned an MBA and Ph.D. from the University of Chicago. He taught at the Massachusetts Institute of Technology (MIT) and the University of Chicago before joining Stanford in 1983 as a finance professor. Scholes was also a co-founder of the hedge fund Long-Term Capital Management, which was initially extremely successful but later failed spectacularly, which led to a group of large banks bailing them out to prevent an averse reaction in the financial markets.

RELATED TERMS
  1. Black Scholes Model

    A model of price variation over time of financial instruments ...
  2. Black's Model

    A variation of the popular Black-Scholes options pricing model ...
  3. Tax Evasion

    An illegal practice where a person, organization or corporation ...
  4. Long-Term Capital Management - ...

    A large hedge fund led by Nobel Prize-winning economists and ...
  5. Tax Avoidance

    The use of legal methods to modify an individual's financial ...
  6. Credibility Theory

    Tools, policies, and procedures used by actuaries when examining ...
Related Articles
  1. Professionals

    Quants: The Rocket Scientists Of Wall Street

    Blend math, finance and computer skills to command a high - and well deserved - salary.
  2. Mutual Funds & ETFs

    Taking A Look Behind Hedge Funds

    Hedge funds can draw returns well above the market average even in a weak economy. Learn about the risks.
  3. Options & Futures

    Massive Hedge Fund Failures

    Flying high one day but not the next - see the stories behind some spectacular meltdowns.
  4. Options & Futures

    Hedge Funds: Higher Returns Or Just High Fees?

    Discover the advantages and pitfalls of hedge funds and the questions to ask when choosing one.
  5. Options & Futures

    Hedge Funds Hunt For Upside, Regardless Of The Market

    Hedge funds seek positive absolute returns, and engage in aggressive strategies to make this happen.
  6. Professionals

    How do companies measure labor supply in human resources planning?

    Find out how and why a company's human resources department would measure labor supply, and what policies would address a shortage or surplus.
  7. Fundamental Analysis

    Why are OTC (over-the-counter) transactions controversial?

    Learn more about over-the-counter transactions, and why OTC traders are considered riskier than traders working with larger market exchanges.
  8. Options & Futures

    What is the difference between arbitrage and hedging?

    Dive into two very important financial concepts: arbitrage and hedging. See how each of these strategies can play a role for savvy investors.
  9. Fundamental Analysis

    What is the difference between cost of equity and cost of capital?

    Read about some of the differences between a company's cost of equity and its cost of capital, two measures of its required returns on raised capital.
  10. Fundamental Analysis

    What is arbitrage pricing theory?

    Find out what arbitrage pricing theory is and how it can theoretically be used by investors to generate risk-free profit opportunities.

You May Also Like

Hot Definitions
  1. Multiplier Effect

    The expansion of a country's money supply that results from banks being able to lend. The size of the multiplier effect depends ...
  2. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  3. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  4. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  5. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  6. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
Trading Center