Myron Scholes

Myron S. Scholes (born 1941) is a Canadian-born American economist and professor emeritus of finance at Stanford Graduate School of Business, best known for co-developing the Black-Scholes formula—a mathematical model for determining the fair price of European-style options based on factors including the underlying asset price, strike price, time to expiration, risk-free rate, and volatility.

Working with Fischer Black and Robert C. Merton, Scholes published the seminal paper outlining the model in 1973, which assumed frictionless markets, log-normal asset price distributions, constant volatility, and the ability to hedge continuously, thereby enabling the dynamic replication of option payoffs and revolutionizing derivatives trading by providing a standardized valuation tool that facilitated the growth of options markets worldwide.

Myron Scholes was born on July 1, 1941, in Timmins, Ontario, Canada, to a Jewish family of modest means affected by the Great Depression. His father, originally from New York City and trained as a dentist, had moved to the gold-mining town of Timmins seeking opportunity but shifted to teaching and selling life insurance after economic downturns reduced demand for dental services. His mother was a homemaker whose family owned a string of general stores, providing indirect exposure to small-scale commerce amid regional prosperity and volatility. In 1951, when Scholes was ten, the family relocated to Hamilton, Ontario, where his eyesight condition was treated.