ABSTRACT

In recent years, modeling financial uncertainty using stochastic processes has become increasingly important, but it is commonly perceived as requiring a deep mathematical background. Stochastic Processes with Applications to Finance shows that this is not necessarily so. It presents the theory of discrete stochastic processes and their application

chapter 2|22 pages

Elements in Probability

chapter 3|20 pages

Useful Distributions in Finance

chapter 4|14 pages

Derivative Securities

chapter 6|16 pages

Random Walks

chapter 7|16 pages

The Binomial Model

chapter 9|16 pages

Markov Chains

chapter 10|18 pages

Monte Carlo Simulation