Application of malliavin calculus in mean-variance hedging strategy

HIGHLIGHTS

  • who: Hedging Strategy and colleagues from the School of Mathematics and Statistics, Beihua University, Jilin City, China have published the paper: Application of Malliavin Calculus in Mean-Variance Hedging Strategy, in the Journal: Mathematical Problems in Engineering of 28/08/2022
  • what: The authors cannot construct a portfolio to reduce intrinsic risk to zero in the incomplete market perfectly, so the authors focus on how to construct a hedging strategy to minimize risk. The authors develop the closed-form expression for the hedging ratio u03d1MVH by the correspondence between t the Clark-Ocone formula and . . .

     

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