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This paper concerns optimal stopping problems driven by the running maximum of a spectrally negative L\'{e}vy process $X$. More precisely, we are interested in modifications of the Shepp-Shiryaev optimal stopping problem [Avram, Kyprianou…

Probability · Mathematics 2013-12-04 Curdin Ott

We study optimal liquidation in the presence of linear temporary and transient price impact along with taking into account a general price predicting finite-variation signal. We formulate this problem as minimization of a cost-risk…

Trading and Market Microstructure · Quantitative Finance 2022-01-17 Eyal Neuman , Moritz Voß

The paper studies the rate of convergence of the weak Euler approximation for solutions to possibly completely degenerate SDEs driven by Levy processes, with Hoelder-continuous coefficients. It investigates the dependence of the rate on the…

Probability · Mathematics 2012-05-14 R. Mikulevicius

The Wiener-Hopf factorization is obtained in closed form for a phase type approximation to the CGMY L\'{e}vy process. This allows, for the approximation, exact computation of first passage times to barrier levels via Laplace transform…

Pricing of Securities · Quantitative Finance 2008-12-02 Soeren Asmussen , Dilip Madan , Martijn Pistorius

In this paper, we focus on numerical approximations of Piecewise Diffusion Markov Processes (PDifMPs), particularly when the explicit flow maps are unavailable. Our approach is based on the thinning method for modelling the jump mechanism…

Numerical Analysis · Mathematics 2024-08-23 Evelyn Buckwar , Amira Meddah

This study considers an optimal reinsurance, investment, and dividend strategy control problem for insurance companies in a regulated Markov regime-switching environment, intending to maximize long-run average reward. Unlike existing single…

Optimization and Control · Mathematics 2025-12-18 Lingjia Zeng , Manman Li

By using absolutely continuous lower bounds of the L\'evy measure, explicit gradient estimates are derived for the semigroup of the corresponding L\'evy process with a linear drift. A derivative formula is presented for the conditional…

Probability · Mathematics 2011-03-16 Feng-Yu Wang

We consider a discrete-time dividend payout problem with risk sensitive shareholders. It is assumed that they are equipped with a risk aversion coefficient and construct their discounted payoff with the help of the exponential premium…

Probability · Mathematics 2017-03-08 Nicole Bäuerle , Anna Jaśkiewicz

We study an optimal dividend problem under a bankruptcy constraint. Firms face a trade-off between potential bankruptcy and extraction of profits. In contrast to previous works, general cash flow drifts, including Ornstein--Uhlenbeck and…

Optimization and Control · Mathematics 2018-03-05 Max Reppen , Jean-Charles Rochet , H. Mete Soner

We consider an optimal stochastic control problem in which a firm's cash/surplus process is controlled by dividend payments and capital injections. Stockholders aim to maximize their dividend stream minus the cost of injecting capital, if…

Optimization and Control · Mathematics 2023-11-20 Jean-François Renaud , Alexandre Roch , Clarence Simard

We consider a diffusion risk model where dividends are paid at rate $U(t) \in [0, u_0]$. We are interested in maximising the dividend payments under a drawdown constraint, that is, we penalise a drawdown size larger than a level $d > 0$. We…

Optimization and Control · Mathematics 2025-11-06 Kira Dudziak , Hanspeter Schmidli

In this paper approximation methods for infinite-dimensional Levy processes, also called (time-dependent) Levy fields, are introduced. For square integrable fields beyond the Gaussian case, it is no longer given that the one-dimensional…

Probability · Mathematics 2017-12-14 Andrea Barth , Andreas Stein

Previous authors have considered optimal stopping problems driven by the running maximum of a spectrally negative L\'evy process $X$, as well as of a one-dimensional diffusion. Many of the aforementioned results are either implicitly or…

Probability · Mathematics 2021-06-25 Mine Caglar , Andreas E. Kyprianou , Ceren Vardar-Acar

The joint distribution of the maximum loss and the maximum gain is obtained for a spectrally negative Levy process until the passage time of a given level. Their marginal distributions up to an independent exponential time are also…

Probability · Mathematics 2019-01-30 Ceren Vardar Acar , Mine Caglar

This paper concerns the numerical approximation for the invariant distribution of Markovian switching L\'evy-driven stochastic differential equations. By combining the tamed-adaptive Euler-Maruyama scheme with the Multi-level Monte Carlo…

Probability · Mathematics 2024-11-07 Hoang-Viet Nguyen , Trung-Thuy Kieu , Duc-Trong Luong , Hoang-Long Ngo , Tran Ngoc Khue

We study the optimal bailout dividend problem with transaction costs for an insurance company, where shareholder payouts align with the arrival times of an independent Poisson process. In this scenario, the underlying risk model follows a…

Optimization and Control · Mathematics 2024-03-26 Harold A. Moreno-Franco , Jose-Luis Pérez

This paper studies the bailout optimal dividend problem with regime switching under the constraint that dividend payments can be made only at the arrival times of an independent Poisson process while capital can be injected continuously in…

Probability · Mathematics 2022-07-05 Dante Mata , Harold A. Moreno-Franco , Kei Noba , José-Luis Pérez

We recall four open problems concerning constructing high-order matrix-exponential approximations for the infimum of a spectrally negative Levy process (with applications to first-passage/ruin probabilities, the waiting time distribution in…

Probability · Mathematics 2012-10-10 Florin Avram , Andras Horvath , M. R. Pistorius

We consider a general d-dimensional Levy-type process with killing. Combining the classical Dyson series approach with a novel polynomial expansion of the generator A(t) of the Levy-type process, we derive a family of asymptotic…

Computational Finance · Quantitative Finance 2014-12-01 Matthew Lorig , Stefano Pagliarani , Andrea Pascucci

This paper investigates a category of constrained fractional optimization problems that emerge in various practical applications. The objective function for this category is characterized by the ratio of a numerator and denominator, both…

Optimization and Control · Mathematics 2026-05-28 Yizun Lin , Jian-Feng Cai , Zhao-Rong Lai , Cheng Li
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