Empirical Study of Monte Carlo Simulation in SSE 50 ETF Options Pricing

Option is one of the most basic financial derivatives, and the pricing of option has always been a significant research topic in financial engineering. Reasonable pricing of options is the premise of options to play an important role in the financial market, for avoiding market risks, stabilizing the financial market, sustainable development of the derivatives market has vital practical significance. Monte Carlo Simulation is an important simulation method in option pricing and it based on probability theory and mathematical statistics, by simulating the path of asset prices to predict a complete average return and obtain an option price estimate. In this paper, the Monte Carlo simulation is used to make an empirical analysis of China's financial derivative SSE 50 ETF option, and the simulation price is compared with prices simulating by other models, and finally compared with the current price of SSE 50 ETF option. The results show that the SSE 50 ETF call option is recommendable to be bought, and has strong feasibility.