Completeness 224
The binomial asset pricing in
this section is called
complete because
every derivative can be replicated
by trading in the underlying stock
and the money market.
In a complete market, every security has a unique price.
Many markets are incomplete, and prices cannot be determined from no-arbitrage considerations alone. Utility based models are still the only theoretically defensible way of treating such markets.
Derivative securities: Options - Binomial asset pricing model