O'Reilly logo

Numerical Methods and Optimization in Finance by Enrico Schumann, Dietmar Maringer, Manfred Gilli

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Chapter Eight

A Gentle Introduction to Financial Simulation

Publisher Summary

Simulation can be generally defined as experiments using models. In finance, there are many areas that use simulation techniques. These include the generation of artificial data when there are not enough real observations; the generation of scenarios; and the testing of assumptions, concepts, or strategies when real-world experiments are not advisable; to name just a few. Also, simulation can be useful when analytical solutions are not feasible; pricing and risk estimation problems are the usual suspects in this group. Simulations can be used to get a better understanding of the behavior and properties of systems, and to spot the need for adjustments and extensions. ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required