Nonlinear Differential Equations in Preventing Financial Risks
- Autores: Xiangli Meng, Rongquan Liu, Mohammed Qeshta, Audil Rashid
- Localización: Applied Mathematics and Nonlinear Sciences, ISSN-e 2444-8656, Vol. 8, Nº. 1, 2023, págs. 757-766
- Idioma: inglés
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Resumen
The nonlinear differential equation option pricing formula is invaluable in financial derivatives investment riskassessment. This article applies the theory of nonlinear differential equations to deal with financial risks incommodity and currency markets. Through this condition, we obtain the fair price process of contingent rights under the classic Black-Scholes model and the price process of the optimal growth investment strategy. The results show that the risk measurement under stable distribution is suitable for investors to manage risk
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