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What is Stochastic Volatility mean?
In statistics, stochastic volatility models are those in which the variance of a stochastic process is itself randomly distributed. They are used in the field of mathematical finance to evaluate derivative securities, such as options. The name derives from the models' treatment of the underlying security's volatility as a random process, governed by state variables such as the price level of the underlying security, the tendency of volatility to revert to some long-run mean value, and the variance of the volatility process itself, among others.
Stochastic volatility models are one approach to resolve a shortcoming of the Black–Scholes model. In particular, models based on Black-Scholes assume that the underlying volatility is constant over the life of the derivative, and unaffected by the changes in the price level of the underlying security. However, these models cannot explain long-observed features of the implied volatility surface such as volatility smile and skew, which indicate that implied volatility does tend to vary with respect to strike price and expiry. By assuming that the volatility of the underlying price is a stochastic process rather than a constant, it becomes possible to model derivatives more accurately.
referenceFull Form | Category |
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Serious Vibes | Academic & Science |
Science Viking | Academic & Science |
Sea View | Academic & Science |
Student Village | Academic & Science |
Sales Volume | Accounts and Finance |
Short Version | Business |
Stern Volmer | Business |
Super Value | Business |
Svensk Vinnare | Business |
Strayer Voigt | Business |
Stochastic Volatility | Chemistry |
Sex Value | Community |
Silent Version | Community |
Signature Version | Community |
Scalar Value | Computer Assembly Language |
Save Video | Computer Assembly Language |
Storage Violation | Computing |
Sony Vegas | Computing |
Saginaw Valley | Earth Science |
Slowly Varying | General |
Single Vacation | General |
Subject Verb | General |
Sindbis Virus | General |
Solus Veritas | General |
Super Veteran | General |
Star of Valor | General |
Sacs Vides (empty mail bags) | General |
Spinto Veloce | General |
Sales Value | General |
s for Versicherung | General |
Super Veloce | General |
Sub Verbo | General |
Springer Verlag | General |
Saudi Arabia Airline | General |
Saggy Vagina | General |
Semantic Value | General |
Sequential Variability | General |
Self Voicing | General |
Starcraft Victory | General |
Sound Verification | General |
Sillicon Valley | General |
Save Versus | General |
Stationary Value | General |
Signoria Vostra | General |
Single Vortex | General |
Safety Vechicle | General |
Subjective View | General |
Side Valve | General |
Solution Value | General |
Selmer Valve | General |
Singed Vibrissae | General |
Single Void | General |
Straight Vanilla | General |
Solid Volume | General |
Stop Valve | General |
Sweet Vermouth | General |
Super Velochi | General |
Solenoid Valve | General |
Systems View | General |
Sudden Victory | General |
Scalar Vector | General |
Sailor Venus | General |
Sluice Valve | General |
Standard Value | General |
State Variable | General |
Side View | General |
Special Value | General |
Special Version | General |
Single Valued | General |
Sonorant Voicing | General |
Super Vegeta | General |
Special Victim | General |
Steve Vogel | General |
Source Of Variation | General |
Saftey Vehicle | Governmental |
Safety Vehicle | Governmental |
Savannah Field Office | Governmental |
Saline vehicle | Governmental |
Standard Vehicle | Governmental |
Slow Vehicle | Governmental |
Special Vehicles | Governmental |
Silicon Valley | Governmental |
Sailing Vessel | Governmental |
Sport Veloce | Governmental |
Sierra Vista | Governmental |
Suzuki Vee | Governmental |
Satellite Vehicle | Governmental |
Societal Value | Governmental |
Stroke Volume | Governmental |
Spectrol | Governmental |
Sudden Valley | Governmental |
SIWAN JN | Indian Railway Station |
Savona (Provence) | International |
Sud-Vest | International |
Sch?ervertretung | International |
Sindicato Vertical | International |
Sub Verbum | International |
Schülervertretung | International |
Sozialversicherung | International |
Sportverein | International |
Sub Verso | International |
Short for Verein | Internet |
Serum Viscosity | Medical |
severe | Medical |
Start Value | Medical |
Simian Virus | Medical |
Splice Variant | Medical |
Stink Value | Messaging |
Schedule Variance | Military and Defence |
Special Vehicle | Military and Defence |
Sniper Version | Military and Defence |
Short Vector | Physics Related |
Sverige (Sweden) | Regional |
Greater Shenandoah Valley Development (Shenandoah Valley Railroad) | Regional |
Swedish | Regional |
Greater Shenandoah Valley Development Company - Shenandoah Valley Railroad | Regional |
Smart Vu | Softwares |
Super Version | Softwares |
Simulate and View | Softwares |
Saturn V Rocket | Space Science |
Safety Valve | Space Science |
Shuttle Vehicle | Space Science |
Solemoid Valve | Space Science |
Stator Vector | Space Science |
Space Vehicle | Space Science |
Standard Velocity | Space Science |
Sports Van | Sports |
Sport Velture | Sports |
Short Vertical | Sports |
Smashville | Sports |
Score Value | Sports |
SaVe(s) | Sports |
Stay Vicious | Sports |
Sport Van | Sports |
Siwan Junction | Transport & Travel |
Posted on 24 Dec 2024, this text provides information on Miscellaneous in Chemistry related to Chemistry. Please note that while accuracy is prioritized, the data presented might not be entirely correct or up-to-date. This information is offered for general knowledge and informational purposes only, and should not be considered as a substitute for professional advice.
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