Multiple Binomial Period: Risk-Neutral Probabilities Example: The current price a continuous-dividend paying stock is $100 per share. Its volatility given to be 0.2 and its dividend yield is 0.03. - The continuous compounded, risk-free interest rate equals 0.06. Consider a $95-strike European put option on the above stock with nine months to expiration using a three-period forward binomial tree, find the price of this put option. Solution: