2026-07-072026-07-07http://salesiana.dossiersoluciones.com/handle/123456789/208864In this work, I address the issue of forming riskless hedge in the continuous time option pricing model with stochastic stock volatility. I show that it is essential to verify whether the replicating portfolio is self-financing, in order for the theory to be self-consistent. The replicating methods in existing finance literature are shown to violate the self-financing constraint when the underlying asset has stochastic volatility. Correct self-financing hedge is formed in this article.8 pages, Revtex styleStatistical MechanicsPricing of Securitiestext