Publication

2003 - Springer Berlin Heidelberg, Berlin, Heidelberg, Germany

Language

English

Word Count

106,000 words, Guess

Page Count

424 pages

Physical Format

[electronic resource] /

Identifiers

Classifications

  • DDC657.8333
  • LCCHG1-9999

Description

A comprehensive overview of weak convergence of stochastic processes and its application to the study of financial markets. Split into three parts, the first recalls the mathematics of stochastic processes and stochastic calculus with special emphasis on contiguity properties and weak convergence of stochastic integrals. The second part is devoted to the analysis of financial theory from the convergence point of view. The main problems such as portfolio optimization, option pricing and hedging are examined, especially when considering discrete-time approximations of continuous-time dynamics. The third part deals with lattice- and tree-based computational procedures for option pricing both on stocks and stochastic bonds. More general discrete approximations are also introduced and detailed.

Subjects

Series Statement

  • Springer Finance

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