Financial speculation as an investment alternative for rural producers

Abstract

This article presents the theory that involves the Black - Scholes and Binomial models as an investment alternative for rural producers. When doing a study on these producers, it is noticed that production in the field is directed to subsistence. New investment alternatives, through mathematical models in the pricing of options in the financial markets, are necessary not only to increase investment in the rural environment, but also to be another way to get income. Given the uncertainty scenarios it is possible to conclude that, if the rural producer uses the models for a scenario where there is a great variation in the volatility of the commodities, the ideal is to use the Binomial model that presents better results. If the scenario is with a variation in the interest rate prevailing in the market then it is favorable to use the Black - Scholes model.