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stochastic variance


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1 عمومی:: واریانس تصادفی

Throughout, we keep the term stochastic variance for σ 2(t). The vector of factors X(t) driving the stochastic variance of the price process follows a Lévy-driven SDE, specified in (29), where LX(t) is a k-dimensional Lévy process. driving the stochastic variance, D is a differential operator, and CARMA(2, 1) model for the stochastic variance. In Section 6.2 we concentrate on a CARMA(2, 1) process for the stochastic variance, which we parameterize as

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