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The aim of this paper is to discuss both higher-order asymptotic expansions and skewed approximations for the Bayesian Discrepancy Measure for testing precise statistical hypotheses. In particular, we derive results on third-order…

Methodology · Statistics 2025-05-02 Elena Bortolato , Francesco Bertolino , Monica Musio , Laura Ventura

This work proposes and analyzes a compressed sensing approach to polynomial approximation of complex-valued functions in high dimensions. Of particular interest is the setting where the target function is smooth, characterized by a rapidly…

Numerical Analysis · Mathematics 2020-01-22 Abdellah Chkifa , Nick Dexter , Hoang Tran , Clayton G. Webster

In this thesis, we extend the recently introduced theory of stochastic modified equations (SMEs) for stochastic gradient optimization algorithms. In Ch. 3 we study time-inhomogeneous SDEs driven by Brownian motion. For certain SDEs we prove…

Probability · Mathematics 2025-11-26 Stefan Perko

A formal mean square error expansion (MSE) is derived for Euler--Maruyama numerical solutions of stochastic differential equations (SDE). The error expansion is used to construct a pathwise a posteriori adaptive time stepping…

Numerical Analysis · Mathematics 2015-07-16 Håkon Hoel , Juho Häppölä , Raúl Tempone

Backpropagation through (neural) SDE solvers is traditionally approached in two ways: discretise-then-optimise, which offers accurate gradients but incurs prohibitive memory costs; and optimise-then-discretise, which achieves constant…

Machine Learning · Computer Science 2026-05-12 Daniil Shmelev , Luke Thompson , Cristopher Salvi

Two discretizations of a class of locally Lipschitz Markovian backward stochastic differential equations (BSDEs) are studied. The first is the classical Euler scheme which approximates a projection of the processes Z, and the second a novel…

Probability · Mathematics 2014-08-21 Plamen Turkedjiev

Using Malliavin calculus techniques, we derive an analytical formula for the price of European options, for any model including local volatility and Poisson jump process. We show that the accuracy of the formula depends on the smoothness of…

Pricing of Securities · Quantitative Finance 2009-06-15 Eric Benhamou , Emmanuel Gobet , Mohammed Miri

In this paper, prediction for linear systems with missing information is investigated. New methods are introduced to improve the Mean Squared Error (MSE) on the test set in comparison to state-of-the-art methods, through appropriate tuning…

Machine Learning · Statistics 2017-01-04 Mohammad Amin Fakharian , Ashkan Esmaeili , Farokh Marvasti

In this paper, we propose a dynamically low-dimensional approximation method to solve a class of time-dependent multiscale stochastic diffusion equations. A dynamically bi-orthogonal (DyBO) method was developed to explore low-dimensional…

Numerical Analysis · Mathematics 2019-02-05 Eric T. Chung , Sai-Mang Pun , Zhiwen Zhang

This work develops Monte Carlo Euler adaptive time stepping methods for the weak approximation problem of jump diffusion driven stochastic differential equations. The main result is the derivation of a new expansion for the omputational…

Numerical Analysis · Mathematics 2007-05-23 E. Mordecki , A. Szepessy , R. Tempone , G. E. Zouraris

In this paper, we provide a theoretical analysis of the recently introduced weakly adversarial networks (WAN) method, used to approximate partial differential equations in high dimensions. We address the existence and stability of the…

Numerical Analysis · Mathematics 2024-01-31 Silvia Bertoluzza , Erik Burman , Cuiyu He

The rough Heston model is a very popular recent model in mathematical finance; however, the lack of Markov and semimartingale properties poses significant challenges in both theory and practice. A way to resolve this problem is to use…

Computational Finance · Quantitative Finance 2023-09-14 Christian Bayer , Simon Breneis

This article proposes a new approximation scheme for quadratic-growth BSDEs in a Markovian setting by connecting a series of semi-analytic asymptotic expansions applied to short-time intervals. Although there remains a condition which needs…

Computational Finance · Quantitative Finance 2018-05-24 Masaaki Fujii , Akihiko Takahashi

This work aims at making a comprehensive contribution in the general area of parametric inference for discretely observed diffusion processes. Established approaches for likelihood-based estimation invoke a time-discretisation scheme for…

Methodology · Statistics 2024-01-30 Yuga Iguchi , Alexandros Beskos , Matthew M. Graham

We propose machine learning methods for solving fully nonlinear partial differential equations (PDEs) with convex Hamiltonian. Our algorithms are conducted in two steps. First the PDE is rewritten in its dual stochastic control…

Computational Finance · Quantitative Finance 2022-05-23 William Lefebvre , Grégoire Loeper , Huyên Pham

In this paper, we develop a novel method based on Malliavin calculus to find an approximation for the convexity adjustment for various classical interest rate products. Malliavin calculus provides a simple way to get a template for the…

Mathematical Finance · Quantitative Finance 2023-08-28 David García-Lorite , Raul Merino

We present an implicit Split-Step explicit Euler type Method (dubbed SSM) for the simulation of McKean-Vlasov Stochastic Differential Equations (MV-SDEs) with drifts of superlinear growth in space, Lipschitz in measure and non-constant…

Numerical Analysis · Mathematics 2022-05-10 Xingyuan Chen , Goncalo dos Reis

Stochastic differential equation (SDE in short) solvers find numerous applications across various fields. However, in practical simulations, we usually resort to using Ito-Taylor series-based methods like the Euler-Maruyama method. These…

Statistics Theory · Mathematics 2023-12-14 Jingyuan Li , Wei Liu

Probabilistic ordinary differential equation (ODE) solvers have been introduced over the past decade as uncertainty-aware numerical integrators. They typically proceed by assuming a functional prior to the ODE solution, which is then…

Numerical Analysis · Mathematics 2025-03-25 Yvann Le Fay , Simo Särkkä , Adrien Corenflos

We discuss through multiple numerical examples the accuracy and efficiency of a micro-macro acceleration method for stiff stochastic differential equations (SDEs) with a time-scale separation between the fast microscopic dynamics and the…

Numerical Analysis · Mathematics 2019-02-22 Hannes Vandecasteele , Przemysław Zieliński , Giovanni Samaey