Lognormal distribution, Mathematics

Assignment Help:

The Lognormal Distribution

If ln(X) is a normally distributed random variable, then X is said to be a lognormal variable.

If P1, P2, P3, ... are the prices of a scrip in periods 1, 2, 3, ..., some applications in finance require ln (P2/P1), ln (P3/P2),... to be normally distributed, that is, continuously compounded returns are required to be normal. This property is described as “Stock Prices are Lognormal”.

REMARK

The previous random variables arose out of natural experiments. The following distributions are derived distributions. That is, it is a function of other distributions. We require the following two distributions in Testing of Hypothesis. and our presentation will be restricted by our requirements. 


Related Discussions:- Lognormal distribution

System of first order equations, Consider the Van der Pol oscillator x′′...

Consider the Van der Pol oscillator x′′- µ(1 - x 2 )x′ + x = 0 (a) Write this equation as a system of first order equations (b) Taking µ = 2, use MatLab's routine ode45 to

VAM, applications of VAM.

applications of VAM.

1 application of complex analysis in THERMODYNAMICS, Hi, this is EBADULLA ...

Hi, this is EBADULLA its about math assignment. 1 application of complex analysis used in thermodynamics. . what all uses are there in that... plz let mee know this answer.

Curvature - three dimensional space, Curvature - Three Dimensional Space ...

Curvature - Three Dimensional Space In this part we want to briefly discuss the curvature of a smooth curve (remind that for a smooth curve we require → r′ (t) is continuou

Algorithm, what does algorithm refer to

what does algorithm refer to

1trig, how do you find the tan, sin, and cos.

how do you find the tan, sin, and cos.

What is the minimum number of students, Question 1: What is the minimum...

Question 1: What is the minimum number of students each of whom comes from one of the 50 different states, enrolled in a university to guarantee that there are at least 100 who

Solve cos( 4 ) = -1 trig function, Solve cos( 4 θ ) = -1 . Solution ...

Solve cos( 4 θ ) = -1 . Solution There actually isn't too much to do along with this problem.  However, it is different from all the others done to this point.  All the oth

Application of derivatives, the base b of a triangle increases at the rate ...

the base b of a triangle increases at the rate of 2cm per second, and height h decreases at the rate of 1/2 cm per second. Find rate of change of its area when the base and height

Markup & markdown, if prices are calculatead with a 35% markup based on cos...

if prices are calculatead with a 35% markup based on cost,what is the percent that those prices should be marked down to get back to their original cost?Choose any convenient cost

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd