The Early Life of Myron Scholes

Myron Scholes is a Nobel Prize winning economist who helped compose the famous Black-Scholes formula, which has set the standard for asset valuations for binary options trades. The formula is used extensively by economists and has been invoked regularly by binary options traders. His early life was marked by challenges he was forced to overcome, including impaired vision, which plagued him until the age of 26, when he finally had his vision surgically repaired. He was born in 1941 in Timmins, Ontario, and showed an interest in economics from an early age, presaging his monumental work on the Black-Scholes formula. His parents and extended family actively supported his interest, opening an account for him so that he could practice investing money and learning from his experience. He also spent time in his early career assisting his uncle in his business, gaining valuable real-world experience.

Prelude to the Monumental Black-Scholes Formula

Myron Scholes took his first steps towards his Nobel Prize when he entered McMaster University in 1962. His professors introduced him to the work of influential economists such as Milton Friedman, who is known as one of the fathers of modern free-market economics. His graduate studies in the burgeoning field of economics were supervised by Eugene Fama and Merton Miller, two of the leading academics in the field who helped set the direction of economic study. He earned his Masters in Business Administration in 1964 and went on to earn his Ph.D 1969. His path towards his future glory and the formation of the Black-Scholes Model accelerated considerably during the next period of his life, when he accepted a teaching position at the MIT Sloan School of Management.

Myron Scholes at MIT

At MIT, Myron Scholes continued to pursue one of his primary interests as an economist, finding a system that would allow people to determine the value of a particular commodity, taking into account all of the necessary elements, including volatility of how the commodity is traded on the market as well as other relevant elements. It was during his time at MIT that he met Fischer Black, a meeting that ultimately led to a collaboration years later that resulted in the Black-Scholes formula. He also met economist Robert Merton, who shared the 1997 Nobel Prize in economics with Scholes. Although Black been one of the key developers of the formula, he had died several years earlier and was therefore not eligible for the prize.