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It is well-known that large deviations of random walks driven by independent and identically distributed heavy-tailed random variables are governed by the so-called principle of one large jump. We note that further subtleties hold for such…

Probability · Mathematics 2017-01-30 Harald Bernhard , Bikramjit Das

The Hawkes process (HP) has been widely applied to modeling self-exciting events including neuron spikes, earthquakes and tweets. To avoid designing parametric triggering kernel and to be able to quantify the prediction confidence, the…

Machine Learning · Computer Science 2021-02-05 Rui Zhang , Christian Walder , Marian-Andrei Rizoiu

In this paper we introduce two new Hawkes processes, namely, compound and regime-switching compound Hawkes processes, to model the price processes in limit order books. We prove Law of Large Numbers and Functional Central Limit Theorems…

Mathematical Finance · Quantitative Finance 2017-12-11 Anatoliy Swishchuk , Bruno Remillard , Robert Elliott , Jonathan Chavez-Casillas

We develop a quasi-likelihood analysis procedure for a general class of multivariate marked point processes. As a by-product of the general method, we establish under stability and ergodicity conditions the local asymptotic normality of the…

Statistics Theory · Mathematics 2021-08-06 Simon Clinet

The incidence of rare events in fast-slow systems is investigated via analysis of the large deviation principle (LDP) that characterizes the likelihood and pathway of large fluctuations of the slow variables away from their mean behavior --…

Statistical Mechanics · Physics 2016-02-17 Freddy Bouchet , Tobias Grafke , Tomás Tangarife , Eric Vanden-Eijnden

We show that univariate and symmetric multivariate Hawkes processes are only weakly causal: the true log-likelihoods of real and reversed event time vectors are almost equal, thus parameter estimation via maximum likelihood only weakly…

Statistical Finance · Quantitative Finance 2018-04-18 Marcus Cordi , Damien Challet , Ioane Muni Toke

In this work, several convergence results are established for nearly critical self-excited systems in which event arrivals are described by multivariate marked Hawkes point processes. Under some mild high-frequency assumptions, the rescaled…

Probability · Mathematics 2024-01-31 Wei Xu

The extent to which a matching engine can cloud the modelling of underlying order submission and management processes in a financial market remains an unanswered concern with regards to market models. Here we consider a 10-variate Hawkes…

Trading and Market Microstructure · Quantitative Finance 2021-08-18 Ivan Jericevich , Patrick Chang , Tim Gebbie

In this paper we consider the multispecies stirring process on the discrete torus. We prove a large deviation principle for the trajectory of the vector of densities of the different species. The technique of proof consists in extending the…

Probability · Mathematics 2024-10-29 Francesco Casini , Frank Redig , Hidde van Wiechen

Previous work has shown that popular trending events are important external factors which pose significant influence on user search behavior and also provided a way to computationally model this influence. However, their problem formulation…

Machine Learning · Computer Science 2019-03-05 Shubhra Kanti Karmaker Santu , Liangda Li , Yi Chang , ChengXiang Zhai

This article generalises the concept of realised covariation to Hilbert-space-valued stochastic processes. More precisely, based on high-frequency functional data, we construct an estimator of the trace-class operator-valued integrated…

Probability · Mathematics 2020-11-30 Fred Espen Benth , Dennis Schroers , Almut E. D. Veraart

For Markov processes evolving on multiple time-scales a combination of large component scalings and averaging of rapid fluctuations can lead to useful limits for model approximation. A general approach to proving a law of large numbers to a…

Probability · Mathematics 2020-12-29 Lea Popovic

This paper introduces novel frameworks for large deviations and metastability analysis in heavy-tailed stochastic dynamical systems. We develop and apply these frameworks within the context of stochastic difference equation $X^\eta_{j+1}(x)…

Probability · Mathematics 2024-12-12 Xingyu Wang , Chang-Han Rhee

A univariate Hawkes process is a simple point process that is self-exciting and has clustering effect. The intensity of this point process is given by the sum of a baseline intensity and another term that depends on the entire past history…

Probability · Mathematics 2018-10-04 Xuefeng Gao , Lingjiong Zhu

In this paper, we present a maximum likelihood method for estimating the parameters of a univariate Hawkes process with self-excitation or inhibition. Our work generalizes techniques and results that were restricted to the self-exciting…

Statistics Theory · Mathematics 2021-08-23 Anna Bonnet , Miguel Martinez Herrera , Maxime Sangnier

We often rely on probabilistic measures -- e.g. event probability or expected time -- to characterize systems' safety. However, determining these quantities for extremely low-probability events is generally challenging, as standard safety…

Optimization and Control · Mathematics 2026-02-04 Aitor R. Gomez , Manuela L. Bujorianu , Rafal Wisniewski

We prove a large deviations principle for the class of multidimensional affine stochastic volatility models considered in (Gourieroux, C. and Sufana, R., J. Bus. Econ. Stat., 28(3), 2010), where the volatility matrix is modelled by a…

Pricing of Securities · Quantitative Finance 2018-06-20 Aurélien Alfonsi , David Krief , Peter Tankov

In this paper we consider a multivariate risk model with common renewal process, while the logarithmic returns of the insurers investment portfolio, are described by a Levy process. In the two main results are established an asymptotic…

Probability · Mathematics 2025-10-21 Dimitrios G. Konstantinides , Charalampos D. Passalidis

The event sequence of many diverse systems is represented as a sequence of discrete events in a continuous space. Examples of such an event sequence are earthquake aftershock events, financial transactions, e-commerce transactions, social…

Machine Learning · Computer Science 2021-04-23 Jayesh Malaviya

Large and moderate deviation probabilities play an important role in many applied areas, such as insurance and risk analysis. This paper studies the exact moderate and large deviation asymptotics in non-logarithmic form for linear processes…

Statistics Theory · Mathematics 2013-05-07 Magda Peligrad , Hailin Sang , Yunda Zhong , Wei Biao Wu