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In finance, the price of a volatile asset can be modeled using fractional Brownian motion (fBm) with Hurst parameter $H>1/2.$ The Black-Scholes model for the values of returns of an asset using fBm is given as, [Y_t=Y_0…

Probability · Mathematics 2012-08-14 Mine Caglar , Ceren Vardar

In this paper we study the stochastic control problem of partially observed (multi-dimensional) stochastic system driven by both Brownian motions and fractional Brownian motions. In the absence of the powerful tool of Girsanov…

Optimization and Control · Mathematics 2023-08-22 Yueyang Zheng , Yaozhong Hu

In this paper, we study a class of stochastic differential equations with additive noise that contains a fractional Brownian motion (fBM) and a Poisson point process of class (QL). The differential equation of this kind is motivated by the…

Probability · Mathematics 2015-04-14 Lihua Bai , Jin Ma

Neural Ordinary Differential Equations (N-ODEs) are a powerful building block for learning systems, which extend residual networks to a continuous-time dynamical system. We propose a Bayesian version of N-ODEs that enables well-calibrated…

Machine Learning · Computer Science 2020-02-19 Andreas Look , Melih Kandemir

This paper introduces a backward stochastic differential equation driven by both Brownian motion and a Markov chain (BSDEBM). Regime-switching is also incorporated through its driver. The existence and uniqueness of the solution of the…

Probability · Mathematics 2022-03-08 Engel John C. Dela Vega , Robert J. Elliott

Neural networks (NNs) that exploit strong inductive biases based on physical laws and symmetries have shown remarkable success in learning the dynamics of physical systems directly from their trajectory. However, these works focus only on…

Machine Learning · Computer Science 2023-06-21 Suresh Bishnoi , Jayadeva , Sayan Ranu , N. M. Anoop Krishnan

We propose a new stochastic model involving state-dependent variable exponent $p(\cdot)$ which allows modeling of systems where noise intensity adapts to the current state. This new flexible theoretical framework generalizes both the…

Analysis of PDEs · Mathematics 2025-10-22 Mustafa Avci

To convert standard Brownian motion $Z$ into a positive process, Geometric Brownian motion (GBM) $e^{\beta Z_t}, \beta >0$ is widely used. We generalize this positive process by introducing an asymmetry parameter $ \alpha \geq 0$ which…

Mathematical Finance · Quantitative Finance 2018-09-10 Peter Carr , Zhibai Zhang

We consider a stochastic differential equation involving standard and fractional Brownian motion with unknown drift parameter to be estimated. We investigate the standard maximum likelihood estimate of the drift parameter, two non-standard…

Probability · Mathematics 2011-12-13 Yuriy Kozachenko , Alexander Melnikov , Yuliya Mishura

We give an overview over recent studies on the model of Active Brownian Motion (ABM) coupled to reservoirs providing free energy which may be converted into kinetic energy of motion. First, we present an introduction to a general concept of…

Data Analysis, Statistics and Probability · Physics 2009-11-13 Alessandro Fiasconaro , Werner Ebeling , Ewa Gudowska-Nowak

In this paper we construct a framework for doing statistical inference for discretely observed stochastic differential equations (SDEs) where the driving noise has 'memory'. Classical SDE models for inference assume the driving noise to be…

Methodology · Statistics 2013-07-05 Martin Lysy , Natesh S. Pillai

In this thesis, branching Brownian motion (BBM) is a random particle system where the particles diffuse on the real line according to Brownian motions and branch at constant rate into a random number of particles with expectation greater…

Probability · Mathematics 2013-04-02 Pascal Maillard

We begin by exploring the intuition of Brownian motion by explaining its birth through the observations of Robert Brown and later through Bachelier's work on its applications to the financial market and finally its rigorous and concretized…

Statistical Finance · Quantitative Finance 2021-10-26 Yorgos Protonotarios , Pantelis Tassopoulos

Consider the fractional Brownian Motion (fBM) $B^H=\{B^H(t): t \in [0,1] \}$ with Hurst index $H\in (0,1)$. We construct a probability space supporting both $B^H$ and a fully simulatable process $\hat B_{\epsilon}^H $ such that $$\sup_{t\in…

Probability · Mathematics 2019-02-22 Yi Chen , Jing Dong , Hao Ni

In this paper, we investigate suffcient and necessary conditions for the comparison theorem of neutral stochastic functional differential equations driven by G-Brownian motion (G-NSFDE). Moreover, the results extend the ones in the linear…

Probability · Mathematics 2021-09-17 Fen-Fen Yang , Chenggui Yuan

It has been proved by Bovier & Hartung [Elect. J. Probab. 19 (2014)] that the maximum of a variable-speed branching Brownian motion (BBM) in the weak correlation regime converges to a randomly shifted Gumbel distribution. The random shift…

Probability · Mathematics 2017-12-13 Constantin Glenz , Nicola Kistler , Marius A. Schmidt

The sub-fractional Brownian motion (sfBm) is a stochastic process, characterized by non-stationarity in their increments and long-range dependency, considered as an intermediate step between the standard Brownian motion (Bm) and the…

Mathematical Finance · Quantitative Finance 2021-04-09 Axel A. Araneda , Nils Bertschinger

We study an optimal control problem on infinite horizon for a controlled stochastic differential equation driven by Brownian motion, with a discounted reward functional. The equation may have memory or delay effects in the coefficients,…

Optimization and Control · Mathematics 2017-10-19 F. Confortola , A. Cosso , M. Fuhrman

The linear fractional stable motion (LFSM) extends the fractional Brownian motion (fBm) by considering $\alpha$-stable increments. We propose a method to forecast future increments of the LFSM from past discrete-time observations, using the…

Methodology · Statistics 2026-05-12 Matthieu Garcin , Karl Sawaya , Thomas Valade

This paper deals with asymptotic errors, limit theorems for errors between numerical and exact solutions of stochastic differential equation (SDE) driven by one-dimensional fractional Brownian motion (fBm). The Euler-Maruyama, higher-order…

Numerical Analysis · Mathematics 2024-10-01 Kento Ueda