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

About matrix?, Explain sparse matrix and Dense matrix?

Explain sparse matrix and Dense matrix?

Calculate the difference in payments of home mortgage loan, You have just r...

You have just renegotiated the interest rate of your home mortgage loan. (This is called rate modification.)  The original loan of $400,000 carries an interest rate is 6% has an or

Quadric surfaces - three dimensional spaces, Quadric Surfaces Earlier w...

Quadric Surfaces Earlier we have looked at lines and planes in three dimensions (or R 3 ) and when these are used fairly heavily at times in a Calculus class there are several

Pre-calculas, find the polar coordinates of each point with the given recta...

find the polar coordinates of each point with the given rectangular coordinates. (-(squareroot(3)),3

LINEAR PROGRAMMING, Richland Health has three hospitals in the greater Tamp...

Richland Health has three hospitals in the greater Tampa, Florida area. Demand for patient services varies considerably during the fall and winter months due to the temporary influ

If a differential equation does have a solution can we find?, It may seem l...

It may seem like an odd question to ask and until now the answer is not all the time yes. Just as we identify that a solution to a differential equations exists does not implies th

Laws of indicies in fraction.., help to solve the laws of indicies chapter ...

help to solve the laws of indicies chapter 9c book 3 high school example19to the power3_2 what is answer

Introduction , what states and marketing tasks?

what states and marketing tasks?

Find out the value of the subsequent summation, Using the formulas and prop...

Using the formulas and properties from above find out the value of the subsequent summation. c The first thing that we require to do here is square out the stuff being summe

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