New study reveals groundbreaking insights into pricing of financial assets.
The article explores different linear stochastic volatility models in finance, focusing on how asset prices change over time. These models involve complex mathematical equations that help predict the prices of financial options like call and put options. The researchers found specific formulas for the log-normal stochastic volatility model, making it easier to calculate option prices. They also discovered new insights for the Heston and extended Heston stochastic volatility models.