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We consider the diffusive limit of a typical pure-jump Markovian control problem as the intensity of the driving Poisson process tends to infinity. We show that the convergence speed is provided by the H\"older constant of the Hessian of…

Optimization and Control · Mathematics 2022-08-19 Marc Abeille , Bruno Bouchard , Lorenzo Croissant

In a classical problem for the stopping of a diffusion process $(X_t)_{t \geq 0}$, where the goal is to maximise the expected discounted value of a function of the stopped process ${\mathbb E}^x[e^{-\beta \tau}g(X_\tau)]$, maximisation…

Probability · Mathematics 2020-04-27 David Hobson

We study the problem of stopping a Brownian motion at a given distribution $\nu$ while optimizing a reward function that depends on the (possibly randomized) stopping time and the Brownian motion. Our first result establishes that the set…

Probability · Mathematics 2020-04-15 Mathias Beiglböck , Marcel Nutz , Florian Stebegg

We introduce a mixed {\em generalized} Dynkin game/stochastic control with ${\cal E}^f$-expectation in a Markovian framework. We study both the case when the terminal reward function is supposed to be Borelian only and when it is…

Optimization and Control · Mathematics 2016-07-21 Roxana Dumitrescu , Marie-Claire Quenez , Agnès Sulem

This paper mainly investigates reflected stochastic recursive control problems governed by jump-diffusion dynamics. The system's state evolution is described by a stochastic differential equation driven by both Brownian motion and Poisson…

Optimization and Control · Mathematics 2025-05-15 Lu Liu , Qingmeng Wei

We consider the sequential decision problem faced by the manager of an electric vehicle (EV) charging station, who aims to satisfy the charging demand of the customer while minimizing cost. Since the total time needed to charge the EV up to…

Optimization and Control · Mathematics 2017-10-05 Daniel R. Jiang , Warren B. Powell

In this paper, we consider the classical problem of utility maximization in a financial market allowing jumps. Assuming that the constraint set is a compact set, rather than a convex one, we use a dynamic method from which we derive a…

Probability · Mathematics 2008-12-10 Marie-Amelie Morlais

We study the optimal stopping problem of McKean-Vlasov diffusions when the criterion is a function of the law of the stopped process. A remarkable new feature in this setting is that the stopping time also impacts the dynamics of the…

Probability · Mathematics 2023-01-18 Mehdi Talbi , Nizar Touzi , Jianfeng Zhang

We study a multi-dimensional optimal execution problem in illiquid markets with both instantaneous and persistent price impact and stochastic resilience. In our model the value function can be described by a multi-dimensional backward…

Optimization and Control · Mathematics 2018-09-07 Ulrich Horst , Xiaonyu Xia

We introduce a new formulation of reflected BSDEs and doubly reflected BSDEs associated with irregular obstacles. In the first part of the paper, we consider an extension of the classical optimal stopping problem over a larger set of…

Probability · Mathematics 2023-03-31 Ihsan Arharas , Youssef Ouknine

Considering a real-valued diffusion, a real-valued reward function and a positive discount rate, we provide an algorithm to solve the optimal stopping problem consisting in finding the optimal expected discounted reward and the optimal…

Probability · Mathematics 2019-09-24 Fabián Crocce , Ernesto Mordecki

The paper deals with a Bolza optimal control problem for a dynamical system which motion is described by a delay differential equation under an initial condition defined by a piecewise continuous function. For the value functional in this…

Optimization and Control · Mathematics 2020-10-20 Anton Plaksin

In this paper, we consider a multi-objective control problem for stochastic systems that seeks to minimize a cost of interest while ensuring safety. We introduce a novel measure of safety risk using the conditional value-at-risk and a set…

Optimization and Control · Mathematics 2018-02-23 Samantha Samuelson , Insoon Yang

In the nonconvex case solutions of rate-independent systems may develop jumps as a function of time. To model such jumps, we adopt the philosophy that rate independence should be considered as limit of systems with smaller and smaller…

Analysis of PDEs · Mathematics 2018-01-17 Alexander Mielke , Riccarda Rossi , Giuseppe Savare'

In this paper we solve the hedge fund manager's optimization problem in a model that allows for investors to enter and leave the fund over time depending on its performance. The manager's payoff at the end of the year will then depend not…

Portfolio Management · Quantitative Finance 2014-03-04 Moritz Duembgen , L. C. G. Rogers

This paper studies a system of $m$ variational inequalities with interconnected obstacles in infinite horizon associated to optimal multi-modes switching problems. Our main result is the existence and uniqueness of a continuous solution in…

Optimization and Control · Mathematics 2023-03-09 Brahim El Asri , Imade Fakhouri , Nacer Ourkiya

A classic solution technique for Markov decision processes (MDP) and stochastic games (SG) is value iteration (VI). Due to its good practical performance, this approximative approach is typically preferred over exact techniques, even though…

Artificial Intelligence · Computer Science 2023-04-21 Jan Křetínský , Tobias Meggendorfer , Maximilian Weininger

We solve two stochastic control problems in which a player tries to minimize or maximize the exit time from an interval of a Brownian particle, by controlling its drift. The player can change from one drift to another but is subject to a…

Probability · Mathematics 2014-08-19 Robert C. Dalang , Laura Vinckenbosch

We consider a general class of stochastic optimal control problems, where the state process lives in a real separable Hilbert space and is driven by a cylindrical Brownian motion and a Poisson random measure; no special structure is imposed…

Probability · Mathematics 2018-10-04 Elena Bandini , Fulvia Confortola , Andrea Cosso

We study an optimal control problem related to swing option pricing in a general non-Markovian setting in continuous time. As a main result we show that the value process solves a first-order non-linear backward stochastic partial…

Pricing of Securities · Quantitative Finance 2021-05-31 Christian Bender , Nikolai Dokuchaev