Valuation of American Call Option Considering Uncertain Volatility

Valuation of American Call Option Considering Uncertain Volatility

Year:    2010

Author:    I. Hlaváček

Advances in Applied Mathematics and Mechanics, Vol. 2 (2010), Iss. 2 : pp. 211–221

Abstract

The parabolic variational inequality for simulating the valuation of American option is used to analyze a continuous dependence of the solution with respect to the uncertain volatility parameter. Three kinds of the continuity are proved, enabling us to employ the maximum range method for the uncertain parameter, under the condition that the criterion-functional has the corresponding property.

You do not have full access to this article.

Already a Subscriber? Sign in as an individual or via your institution

Journal Article Details

Publisher Name:    Global Science Press

Language:    English

DOI:    https://doi.org/10.4208/aamm.09-m0967

Advances in Applied Mathematics and Mechanics, Vol. 2 (2010), Iss. 2 : pp. 211–221

Published online:    2010-01

AMS Subject Headings:    Global Science Press

Copyright:    COPYRIGHT: © Global Science Press

Pages:    11

Keywords:    American options parabolic variational inequality uncertain parameter.

Author Details

I. Hlaváček