Right, that is exactly correct. That is the only difference between the two models. BS calculates the forward price and does its calculations using that forward price as the underlying. Black does NOT calculate a forward price, and uses whatever price you input as the underlying. That's it. There is no other difference. The rest of what you posted is just various justifications for doing it that way. Look at it this way. If you bought IBM for a total of $10,000 and held it for a year and sold it for the same price you paid, you still lost money - the amount of money you DIDN'T earn by putting that $10,000 in T-bills. Let's say the amount you "lost" was $1,000. Another way of expressing that is to calculate a "forward price" that you paid for the stock. In this case the "forward price" would have been $11,000. You sold IBM for $10,000, so you lost $1,000. Just another way of expressing the same thing. But there is no cost to carry a futures contract. Yes, you have to put up margin, but you can put that margin in T-bills. So if you go long gold futures, hold for a year, and sell at the same price you bought, it hasn't cost you a penny in missed interest. That's a sort of common-sense way of understanding the difference between the Black and Black-Scholes models. It's really very, very simple - don't make it any more complicated than it is!