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

Compare and contrast african immigrants, Compare and contrast African immig...

Compare and contrast African immigrants with our immigrant groups? How are they different? What are the implications of these differences for their adjustment to the larger society

Definition of vertical asymptote, Vertical asymptote Definition : The funct...

Vertical asymptote Definition : The function f(x) will contain a vertical asymptote at x = a if we contain any of the following limits at x = a .   x→a- Note as well that it

Introduction to helping children learn mathematics, INTRODUCTION :  Do you...

INTRODUCTION :  Do you remember your school-going days, particularly your mathematics classes? What was it about those classes that made you like, or dislike, mathematics? In this

Inverse function, how to solve the equation of an inverse function

how to solve the equation of an inverse function

Shares and dividend, a man in rested rupee 800 is buying rupee 5 shares and...

a man in rested rupee 800 is buying rupee 5 shares and then are selling at premium of rupee 1.15. He sells all the shares.find profit

Find integer if sum of two consecutive odd integers is -112, The sum of two...

The sum of two consecutive odd integers is -112. What is the larger integer? Two consecutive odd integers are numbers in order such as 3 and 5 or -31 and -29, that are each 2 n

Fractions, if you have 1/5 of a candy bar and 4 friends how much will they ...

if you have 1/5 of a candy bar and 4 friends how much will they get

Advanced functions, writ the equation that describes the motion of a point ...

writ the equation that describes the motion of a point on the wheel that has a center of 4m off the ground, has radius of 15 cm, makes a full rotation every 10 seconds and starts a

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