What is the difference between probability & risk neutralprobability?

  • #1
woundedtiger4
189
0
Are both same or different? Can someone give me some example to understand?

Thanks in advance
 

Answers and Replies

  • #2
MarneMath
Education Advisor
549
198
Well, probability is a board overarching term, while risk neutral probability is specific measure that tends to occur when talking about a free arbitrage market.
 

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