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The Skorokhod Embedding Problem (SEP) is one of the classical problems in the study of stochastic processes, with applications in many different fields (cf.~ the surveys \cite{Ob04,Ho11}). Many of these applications have natural…

Probability · Mathematics 2017-05-29 Mathias Beiglboeck , Alexander Cox , Martin Huesmann

We study the existence, optimality, and construction of non-randomised stopping times that solve the Skorokhod embedding problem (SEP) for Markov processes which satisfy a duality assumption. These stopping times are hitting times of…

Probability · Mathematics 2021-03-30 Paul Gassiat , Harald Oberhauser , Christina Z. Zou

In this article, we consider a generalisation of the Skorokhod embedding problem (SEP) with a delayed starting time. In the delayed SEP, we look for stopping times which embed a given measure in a stochastic process, which occur after a…

Probability · Mathematics 2023-12-08 Alexander M. G. Cox , Annemarie M. Grass

Most results regarding Skorokhod embedding problems (SEP) so far rely on the assumption that the corresponding stopped process is uniformly integrable, which is equivalent to the convex ordering condition…

Probability · Mathematics 2020-01-01 Jiajie Wang

We solve the Skorokhod embedding problem (SEP) for a general time-homogeneous diffusion $X$: given a distribution $\rho$, we construct a stopping time $\tau$ such that the stopped process $X_{\tau}$ has the distribution $\rho$. Our solution…

Probability · Mathematics 2015-06-02 Stefan Ankirchner , David Hobson , Philipp Strack

This paper examines the Root solution of the Skorohod embedding problem given full marginals on some compact time interval. Our results are obtained by limiting arguments based on finitely-many marginals Root solution of Cox, Obl\'oj and…

Optimization and Control · Mathematics 2019-12-18 Alexandre Richard , Xiaolu Tan , Nizar Touzi

We revisit work of Rost, Dupire and Cox--Wang on connections between Root's solution of the Skorokhod embedding problem and obstacle problems. We develop an approach based on viscosity sub- and supersolutions and an accompanying comparison…

Probability · Mathematics 2014-09-16 Paul Gassiat , Harald Oberhauser , Goncalo dos Reis

We consider the optimal Skorokhod embedding problem (SEP) given full marginals over the time interval $[0,1]$. The problem is related to the study of extremal martingales associated with a peacock ("process increasing in convex order", by…

Probability · Mathematics 2015-03-03 Sigrid Kallblad , Xiaolu Tan , Nizar Touzi

Recent work of Dupire and Carr and Lee has highlighted the importance of understanding the Skorokhod embedding originally proposed by Root for the model-independent hedging of variance options. Root's work shows that there exists a barrier…

Pricing of Securities · Quantitative Finance 2013-03-13 Alexander M. G. Cox , Jiajie Wang

We provide a new probabilistic proof of the connection between Rost's solution of the Skorokhod embedding problem and a suitable family of optimal stopping problems for Brownian motion with finite time-horizon. In particular we use…

Probability · Mathematics 2017-01-10 Tiziano De Angelis

We solve the $n$-marginal Skorokhod embedding problem for a continuous local martingale and a sequence of probability measures $\mu_1,...,\mu_n$ which are in convex order and satisfy an additional technical assumption. Our construction is…

Probability · Mathematics 2014-01-07 Jan Obłój , Peter Spoida

The Skorokhod embedding problem aims to represent a given probability measure on the real line as the distribution of Brownian motion stopped at a chosen stopping time. In this paper, we consider an extension of the optimal Skorokhod…

Probability · Mathematics 2016-08-04 Gaoyue Guo , Xiaolu Tan , Nizar Touzi

The Skorokhod embedding problem (SEP) is to represent a given probability measure as a Brownian motion $B$ at a particular stopping time. In recent years particular attention has gone to solutions which exhibit additional optimality…

Probability · Mathematics 2023-07-10 Annemarie Grass

We obtain bounds on the distribution of the maximum of a martingale with fixed marginals at finitely many intermediate times. The bounds are sharp and attained by a solution to $n$-marginal Skorokhod embedding problem in Ob{\l}\'oj and…

Probability · Mathematics 2016-01-18 Pierre Henry-Labordère , Jan Obłój , Peter Spoida , Nizar Touzi

Suppose $X$ is a time-homogeneous diffusion on an interval $I^X \subseteq \mathbb R$ and let $\mu$ be a probability measure on $I^X$. Then $\tau$ is a solution of the Skorokhod embedding problem (SEP) for $\mu$ in $X$ if $\tau$ is a…

Probability · Mathematics 2014-03-11 David Hobson

The classical Skorokhod embedding problem for a Brownian motion $W$ asks to find a stopping time $\tau$ so that $W_\tau$ is distributed according to a prescribed probability distribution $\mu$. Many solutions have been proposed during the…

Probability · Mathematics 2019-08-01 Leif Doering , Lukas Gonon , David J. Prömel , Oleg Reichmann

We show that the barrier function in Root's solution to the Skorokhod embedding problem is continuous and finite at every point where the target measure has no atom and its absolutely continuous part is locally bounded away from zero.

Probability · Mathematics 2021-07-12 Erhan Bayraktar , Thomas Bernhardt

We solve the Skorokhod embedding problem for a class of stochastic processes satisfying an inhomogeneous stochastic differential equation (SDE) of the form $d A_t =\mu (t, A_t) d t + \sigma(t, A_t) d W_t$. We provide sufficient conditions…

Probability · Mathematics 2019-06-19 Stefan Ankirchner , Stefan Engelhardt , Alexander Fromm , Goncalo dos Reis

We prove a strong duality result for a linear programming problem which has the interpretation of being a discretised optimal Skorokhod embedding problem, and we recover this continuous time problem as a limit of the discrete problems. With…

Probability · Mathematics 2017-02-24 Alexander M. G. Cox , Sam M. Kinsley

The conformal Skorokhod embedding problem (CSEP) is a planar variant of the classical problem where the solution is now a simply connected domain $D\subset\mathbb{C}$ whose exit time embeds a given probability distribution $\mu$ by…

Probability · Mathematics 2020-06-03 Phanuel Mariano , Hugo Panzo
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