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Analysis of Error with Malliavin Calculus: Application to Hedging

✍ Scribed by E. Temam


Book ID
108550393
Publisher
John Wiley and Sons
Year
2003
Tongue
English
Weight
143 KB
Volume
13
Category
Article
ISSN
0960-1627

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The Euler scheme for stochastic differen
✍ Vlad Bally; Denis Talay πŸ“‚ Article πŸ“… 1995 πŸ› Elsevier Science 🌐 English βš– 304 KB

We study the approximation problem of Ef(Xr) by Ef(X~.), where (Xt) is the solution of a stochastic differential equation, (X~) is defined by the Euler discretization scheme with step T/n, and f is a given function. For smooth f's, Talay and Tubaro had shown that the error Ef(Xr) -Ef(X~) can be expa