For those who downloaded the code, I will try to give some explanation of the code. It simulates the density of mean reverting stochastic differential equations given by the equation
dV(t)=kappa*(theta-V(t)) dt+ epsilon * V(t)^beta * dz(t)
I generate the density of...
Greg, I will be posting my paper on SSRN in about a week to ten days. Paper covers several other aspects of stochastic processes so it requires a bit more work. I received a private message from Orodruin about removal of the other 2nd post saying that it was unsubstantiated with a published...
http://wilmott.com/i/dominant/block.gif
I have worked with generation of transition probabilities of mean reverting CEV type stochastic differential equations using Girsanov theorem. A variable grid is generated and Transition probabilities are calculated from the well known analytic...