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

What is the difference in the two low temperatures, The low temperature in ...

The low temperature in Anchorage, Alaska present was -4°F. The low temperature in Los Angeles, California was 63°F. What is the difference in the two low temperatures? Visualiz

Design a game strategy involves process of learning maths, Doing these sums...

Doing these sums initially in this way helps children see why they carry over numbers to the next column. You may like to devise some related activities now. , EI) Give activ

Algebra, how to solve algebra

how to solve algebra

Example of set representation, Can anybody suggest me any example of Set Re...

Can anybody suggest me any example of Set Representation?

Determine does this point lie on the line, Does this Point Lie on The Line?...

Does this Point Lie on The Line? How do you know if a point lies on a given line? For example, does the point (1, 2) lie on the line 3x + y = 7? If you graph the line and the

Probability., an insurance salesman sells policies to 5 men, all of identic...

an insurance salesman sells policies to 5 men, all of identical age in good health. the probability that a man of this particular age will be alive 30 years hence is 2/3.Find the p

Explain equation, Equation s(in Tth second)=u+at-a/2 seems to be dimensiona...

Equation s(in Tth second)=u+at-a/2 seems to be dimensionally incorrect.why?

Prove the equality of axiom choice, (1) Prove that Zorn's lemma is equivale...

(1) Prove that Zorn's lemma is equivalent to axiom of choice. (2) Use Zorn's Lemma to prove the existence of E.

Estimate the distance to this star, To find the distance to nearby stars, t...

To find the distance to nearby stars, the method of parallax is used. The idea is to find a triangle with the star at one vertex and with a base as large as possible. To do this, t

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