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This paper develops a novel weak multilevel Monte-Carlo (MLMC) approximation scheme for L\'evy-driven Stochastic Differential Equations (SDEs). The scheme is based on the state space discretization (via a continuous-time Markov chain…

Computational Finance · Quantitative Finance 2026-01-21 Aleksandar Mijatović , Romain Palfray

Multilevel Monte Carlo (MLMC) has become an important methodology in applied mathematics for reducing the computational cost of weak approximations. For many problems, it is well-known that strong pairwise coupling of numerical solutions in…

Numerical Analysis · Mathematics 2022-10-11 Neil K. Chada , Håkon Hoel , Ajay Jasra , Georgios E. Zouraris

In solving simulation-based stochastic root-finding or optimization problems that involve rare events, such as in extreme quantile estimation, running crude Monte Carlo can be prohibitively inefficient. To address this issue, importance…

Methodology · Statistics 2021-02-23 Shengyi He , Guangxin Jiang , Henry Lam , Michael C. Fu

The Multilevel Monte Carlo method is an efficient variance reduction technique. It uses a sequence of coarse approximations to reduce the computational cost in uncertainty quantification applications. The method is nowadays often considered…

Numerical Analysis · Mathematics 2018-06-15 Pieterjan Robbe , Dirk Nuyens , Stefan Vandewalle

We study the approximation of $\mathbb{E}f(X_T)$ by a Monte Carlo algorithm, where $X$ is the solution of a stochastic differential equation and $f$ is a given function. We introduce a new variance reduction method, which can be viewed as a…

Probability · Mathematics 2007-05-23 Ahmed Kebaier

As the size of engineered systems grows, problems in reliability theory can become computationally challenging, often due to the combinatorial growth in the cut sets. In this paper we demonstrate how Multilevel Monte Carlo (MLMC) - a…

Computation · Statistics 2017-03-14 Louis J. M. Aslett , Tigran Nagapetyan , Sebastian J. Vollmer

Adaptive importance sampling is a widely spread Monte Carlo technique that uses a re-weighting strategy to iteratively estimate the so-called target distribution. A major drawback of adaptive importance sampling is the large variance of the…

Statistics Theory · Mathematics 2021-11-01 Anna Korba , François Portier

We introduce three related but distinct improvements to multilevel Monte Carlo (MLMC) methods for the solution of systems of stochastic differential equations (SDEs). Firstly, we show that when the payoff function is twice continuously…

Numerical Analysis · Mathematics 2013-09-10 L. F. Ricketson

Monte Carlo methods are widely used importance sampling techniques for studying complex physical systems. Integrating these methods with deep learning has significantly improved efficiency and accuracy in high-dimensional problems and…

Disordered Systems and Neural Networks · Physics 2024-12-24 Yixiong Ren , Jianhui Zhou

We apply multilevel Monte Carlo for option pricing problems using exponential L\'{e}vy models with a uniform timestep discretisation to monitor the running maximum required for lookback and barrier options. The numerical results demonstrate…

Computational Finance · Quantitative Finance 2017-05-31 Mike Giles , Yuan Xia

This paper deals with the Monte-Carlo methods for evaluating expectations of functionals of solutions to McKean-Vlasov Stochastic Differential Equations (MV-SDE) with drifts of super-linear growth. We assume that the MV-SDE is approximated…

Probability · Mathematics 2018-10-15 Goncalo dos Reis , Greig Smith , Peter Tankov

We propose an unconstrained stochastic approximation method of finding the optimal measure change (in an a priori parametric family) for Monte Carlo simulations. We consider different parametric families based on the Girsanov theorem and…

Probability · Mathematics 2018-02-20 Vincent Lemaire , Gilles Pagès

In the first part of this paper we study approximations of trajectories of Piecewise Deter-ministic Processes (PDP) when the flow is not explicit by the thinning method. We also establish a strong error estimate for PDPs as well as a weak…

Probability · Mathematics 2022-02-10 Vincent Lemaire , Michèle Thieullen , Nicolas Thomas

Subsampling is a widely used and effective approach for addressing the computational challenges posed by massive datasets. Substantial progress has been made in developing non-uniform, probability-based subsampling schemes that prioritize…

Methodology · Statistics 2026-05-07 Dingyi Wang , Haiying Wang , Qingpei Hu

We present a multi-level Monte Carlo (MLMC) algorithm with adaptively refined meshes and accurately computed stopping-criteria utilizing adjoint-based a posteriori error analysis for differential equations. This is in contrast to classical…

Numerical Analysis · Mathematics 2022-06-08 Jehanzeb Chaudhry , Zachary Stevens

The marginal likelihood is a central tool for drawing Bayesian inference about the number of components in mixture models. It is often approximated since the exact form is unavailable. A bias in the approximation may be due to an incomplete…

Computation · Statistics 2014-11-14 Jeong Eun Lee , Christian P. Robert

In this work, we tackle the problem of minimising the Conditional-Value-at-Risk (CVaR) of output quantities of complex differential models with random input data, using gradient-based approaches in combination with the Multi-Level Monte…

Numerical Analysis · Mathematics 2023-10-16 Sundar Ganesh , Fabio Nobile

We present a novel multilevel Monte Carlo approach for estimating quantities of interest for stochastic partial differential equations (SPDEs). Drawing inspiration from [Giles and Szpruch: Antithetic multilevel Monte Carlo estimation for…

Numerical Analysis · Mathematics 2025-04-15 Abdul-Lateef Haji-Ali , Andreas Stein

An importance sampling approach for sampling copula models is introduced. We propose two algorithms that improve Monte Carlo estimators when the functional of interest depends mainly on the behaviour of the underlying random vector when at…

Computation · Statistics 2015-04-08 Philipp Arbenz , Mathieu Cambou , Marius Hofert

Improving efficiency of importance sampler is at the center of research in Monte Carlo methods. While adaptive approach is usually difficult within the Markov Chain Monte Carlo framework, the counterpart in importance sampling can be…

Methodology · Statistics 2007-12-11 Heng Lian