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Re:The Rate of Return on Everything, 1870–2015 [pdf] by kgwgk on Friday January 05, 2018 @03:43PM (#16081479)
To price derivatives one uses risk-neutral probabilities, which are different from real-world probabilities. The binomial tree you talk about cannot be used to calculate the expected return. Maybe this was not properly explained in the course you took, or maybe you were not paying attention.

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