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We construct a sequence of functions that uniformly converge (on compact sets) to the price of Asian option, which is written on a stock whose dynamics follows a jump diffusion, exponentially fast. Each of the element in this sequence…

Computational Engineering, Finance, and Science · Computer Science 2008-10-29 Erhan Bayraktar , Hao Xing

This paper deals with Poisson processes on an arbitrary measurable space. Using a direct approach, we derive formulae for moments and cumulants of a vector of multiple Wiener-It\^o integrals with respect to the compensated Poisson process.…

Probability · Mathematics 2014-07-08 Guenter Last , Mathew D. Penrose , Matthias Schulte , Christoph Thaele

We propose a method for extending a given asset pricing formula to account for two additional sources of risk: the risk associated with future changes in market--calibrated parameters and the remaining risk associated with idiosyncratic…

Disordered Systems and Neural Networks · Physics 2008-12-02 T. R. Hurd

The paper discusses multivariate self- and cross-exciting processes. We define a class of multivariate point processes via their corresponding stochastic intensity processes that are driven by stochastic jumps. Essentially, there is a jump…

Probability · Mathematics 2021-08-24 Heidar Eyjolfsson , Dag Tjøstheim

We propose a new generalisation of jump-telegraph process with variable velocities and jumps. Amplitude of the jumps and velocity values are random, and they depend on the time spent by the process in the previous state of the underlying…

Probability · Mathematics 2013-11-22 Nikita Ratanov

We introduce an approximation strategy for the discounted moments of a stochastic process that can, for a large class of problems, approximate the true moments. These moments appear in pricing formulas of financial products such as bonds…

Mathematical Finance · Quantitative Finance 2021-11-02 Chenyu Zhao , Misha van Beek , Peter Spreij , Makhtar Ba

Shape dependence of higher order correlations introduces complication in direct determination of these quantities. For this reason theoretical and observational progress has been restricted in calculating one point distribution functions…

Astrophysics · Physics 2007-05-23 Dipak Munshi , Adrian L. Melott

We introduce and study a family of random processes with a discrete time related to products of random matrices. Such processes are formed by singular values of random matrix products, and the number of factors in a random matrix product…

Mathematical Physics · Physics 2015-11-06 Eugene Strahov

We present the method of moments approach to pricing barrier-type options when the underlying is modelled by a general class of jump diffusions. By general principles the option prices are linked to certain infinite dimensional linear…

Computational Finance · Quantitative Finance 2008-12-25 Bjorn Eriksson , Martijn Pistorius

This paper develops a polynomial normal transformation model, whereby various non-normal probability distributions can be simulated by the standard normal distribution. Two methods are presented to determine the coefficients of polynomial…

Methodology · Statistics 2015-08-27 Qing Xiao

Scrambling and thermalisation are topics of intense study in both condensed matter and high energy physics. Random unitary dynamics form a simple testing-ground for our theoretical understanding of these processes. In this work, we derive…

Quantum Physics · Physics 2021-10-29 Ewan McCulloch

We study the possibility of using multilevel algorithms for the computation of correlation functions of gradient flow observables. For each point in the correlation function an approximate flow is defined which depends only on links in a…

High Energy Physics - Lattice · Physics 2016-04-13 Miguel García Vera , Stefan Schaefer

The paper investigates the problem of performing correlation analysis when the number of observations is very large. In such a case, it is often necessary to combine the random observations to achieve dimensionality reduction of the…

Information Theory · Computer Science 2020-10-19 Pavel Loskot

This work presents a set of new statistics, the cumulant correlators, aimed at high precision analysis of the galaxy distribution. They form a symmetric matrix, $Q_{NM}$, related to moment correlators the same way as cumulants are related…

Astrophysics · Physics 2009-10-30 István Szapudi , Alexander S. Szalay

The usual formulas for the correlation functions in orthogonal and symplectic matrix models express them as quaternion determinants. From this representation one can deduce formulas for spacing probabilities in terms of Fredholm…

solv-int · Physics 2009-07-11 Craig A. Tracy , Harold Widom

We derive a moment formula for generalized fractional polynomial processes, i.e., for polynomial-preserving Markov processes time-changed by an inverse L\'evy-subordinator. If the time change is inverse $\alpha$-stable, the time-derivative…

Probability · Mathematics 2026-02-27 Johannes Assefa , Martin Keller-Ressel

The latest generation of volatility derivatives goes beyond variance and volatility swaps and probes our ability to price realized variance and sojourn times along bridges for the underlying stock price process. In this paper, we give an…

Statistical Finance · Quantitative Finance 2008-12-02 Claudio Albanese , Adel Osseiran

We present a novel class of methods to compute functions of matrices or their action on vectors that are suitable for parallel programming. Solving appropriate simple linear systems of equations in parallel (or computing the inverse of…

Numerical Analysis · Mathematics 2022-10-10 Sergio Blanes

We consider a specific form of explicitly correlated Gaussians -- with tensor pre-factors -- which appear naturally when dealing with certain few-body systems in nuclear and particle physics. We derive analytic matrix elements with these…

Nuclear Theory · Physics 2024-09-12 D. V. Fedorov , A. F. Teilmann , M. C. Østerlund , T. L. Norrbohm

We introduce a new method to calculate the credit exposure of European and path-dependent options. The proposed method is able to calculate accurate expected exposure and potential future exposure profiles under the risk-neutral and the…

Computational Finance · Quantitative Finance 2019-12-04 Kathrin Glau , Ricardo Pachon , Christian Pötz