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In this paper we present a novel approach towards variance reduction for discretised diffusion processes. The proposed approach involves specially constructed control variates and allows for a significant reduction in the variance for the…

Probability · Mathematics 2017-12-05 Denis Belomestny , Stefan Häfner , Mikhail Urusov

In this paper a novel modification of the multilevel Monte Carlo approach, allowing for further significant complexity reduction, is proposed. The idea of the modification is to use the method of control variates to reduce variance at level…

Computational Finance · Quantitative Finance 2017-03-14 Denis Belomestny , Tigran Nagapetyan

We develop exact Markov chain Monte Carlo methods for discretely-sampled, directly and indirectly observed diffusions. The qualification "exact" refers to the fact that the invariant and limiting distribution of the Markov chains is the…

We propose a modification, based on the RESTART (repetitive simulation trials after reaching thresholds) and DPR (dynamics probability redistribution) rare event simulation algorithms, of the standard diffusion Monte Carlo (DMC) algorithm.…

Probability · Mathematics 2014-04-10 Martin Hairer , Jonathan Weare

This paper presents a control variate-based Markov chain Monte Carlo algorithm for efficient sampling from the probability simplex, with a focus on applications in large-scale Bayesian models such as latent Dirichlet allocation. Standard…

Methodology · Statistics 2024-10-02 Francesco Barile , Christopher Nemeth

In this paper we consider parameter estimation for discretely observed diffusion processes. In particular, we focus on data that are observed at low frequency and methodology that can estimate parameters with uncertainty quantification.…

Computation · Statistics 2026-05-01 Jingning Yao , Ajay Jasra , Sheng Jiang

Dispersion is a fundamental concept in statistics, yet standard approaches - especially via stochastic orders - face limitations in the discrete setting. In particular, the classical dispersive order, well-established for continuous…

Methodology · Statistics 2025-11-11 Andreas Eberl , Bernhard Klar , Alfonso Suárez-Llorens

In this paper we propose a novel dual regression-based approach for pricing American options. This approach reduces the complexity of the nested Monte Carlo method and has especially simple form for time discretised diffusion processes. We…

Computational Finance · Quantitative Finance 2018-06-07 Denis Belomestny , Stefan Häfner , Mikhail Urusov

Monte Carlo simulations of diffusion processes often introduce bias in the final result, due to time discretization. Using an auxiliary Poisson process, it is possible to run simulations which are unbiased. In this article, we propose such…

Computational Finance · Quantitative Finance 2016-05-09 Louis Paulot

The most common way to sample from a probability distribution is to use Monte-Carlo methods. For distributions on a continuous state space, one can find diffusions with the target distribution as equilibrium measure, so that the state of…

Probability · Mathematics 2015-10-28 Chii-Ruey Hwang , Raoul Normand , Sheng-Jhih Wu

A resampling scheme provides a way to switch low-weight particles for sequential Monte Carlo with higher-weight particles representing the objective distribution. The less the variance of the weight distribution is, the more concentrated…

Computation · Statistics 2023-09-19 Xiongming Dai , Gerald Baumgartner

We consider the numerical solution of scalar, nonlinear degenerate convection-diffusion problems with random diffusion coefficient and with random flux functions. Building on recent results on the existence, uniqueness and continuous…

Analysis of PDEs · Mathematics 2013-11-08 U. Koley , N. H. Risebro , Ch. Schwab , F. Weber

We present a novel approach of discretizing variable coefficient diffusion operators in the context of meshfree generalized finite difference methods. Our ansatz uses properties of derived operators and combines the discrete Laplace…

Numerical Analysis · Mathematics 2024-06-21 Heinrich Kraus , Jörg Kuhnert , Pratik Suchde

This paper introduces a Monte Carlo method for maximum likelihood inference in the context of discretely observed diffusion processes. The method gives unbiased and a.s.\@ continuous estimators of the likelihood function for a family of…

Statistics Theory · Mathematics 2009-03-03 Alexandros Beskos , Omiros Papaspiliopoulos , Gareth Roberts

We propose a general variance reduction strategy for diffusion processes. Our approach does not require the knowledge of the measure that is sampled, which may indeed be unknown as for nonequilibrium dynamics in statistical physics. We show…

Numerical Analysis · Mathematics 2019-01-29 Julien Roussel , Gabriel Stoltz

Reflected diffusions in polyhedral domains are commonly used as approximate models for stochastic processing networks in heavy traffic. Stationary distributions of such models give useful information on the steady state performance of the…

Probability · Mathematics 2012-05-24 Amarjit Budhiraja , Jiang Chen , Sylvain Rubenthaler

Sampling from the posterior is a key technical problem in Bayesian statistics. Rigorous guarantees are difficult to obtain for Markov Chain Monte Carlo algorithms of common use. In this paper, we study an alternative class of algorithms…

Statistics Theory · Mathematics 2024-08-26 Andrea Montanari , Yuchen Wu

We introduce a variational multiscale closure modeling strategy for the numerical stabilization of proper orthogonal decomposition reduced-order models of convection-dominated equations. As a first step, the new model is analyzed and tested…

Numerical Analysis · Mathematics 2015-03-19 Traian iliescu , Zhu Wang

The control variates method is a classical variance reduction technique for Monte Carlo estimators that exploits correlated auxiliary variables without introducing bias. In many applications, the quantity of interest can be expressed as a…

Statistics Theory · Mathematics 2025-11-10 Louison Bocquet-Nouaille , Jérôme Morio , Benjamin Bobbia

Monte Carlo estimation in plays a crucial role in stochastic reaction networks. However, reducing the statistical uncertainty of the corresponding estimators requires sampling a large number of trajectories. We propose control variates…

Methodology · Statistics 2021-10-19 Michael Backenköhler , Luca Bortolussi , Verena Wolf
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