--%>

What is stable Levy Distribution

What is stable Levy Distribution?

E

Expert

Verified

A generalization that is significant in finance applies to distributions with infinite variance. If the tails of the single distributions have a power-law decay, |x|-1-α along with 0 <α< 2, then the average will tend to a stable Levy distribution.

   Related Questions in Financial Management

  • Q : State the term Calibration in financial

    State the term Calibration in financial model?

  • Q : Main motive behind the experience

    Explain the main motive behind the experience approach to forecasting?

  • Q : Why all apparent arbitrage

    Explain the reasons why all apparent arbitrage opportunities cannot be exploited.

  • Q : Reversing trade in forward markets Why

    Why are most futures positions closed out through a reversing trade instead of held to delivery?In forward markets, about 90 percent of all contracts that are primarily established result in the short making delivery to the long of the asset und

  • Q : Interest payments between

    Create a different arrangement of interest payments between the counterparties and the swap bank that yet leaves each counterparty along with an all-in cost 1/2 percent below each's best rate & the swap bank with a 1/4 percent inflow.Company

  • Q : Question on interest pay through

    Grecian Tile Manufacturing of Athens, Georgia borrows $1,500,000 at LIBOR and a lending margin of 1.25 percent per annum on six-month rollover basis through London bank.  If six-month LIBOR is 4 ½ percent in the first six-month interval and 5 3/8 percent over the second six-mo

  • Q : Determine standard deviation and

    You have one hat containing normally distributed random numbers, with a mean of zero and a standard deviation of σ which is unknown. You draw N numbers φi from this hat. What is the ‘probability’ of drawing all of the numbers &ph

  • Q : Explain the design patterns of an MFC

    Explain the design patterns of an MFC application?

  • Q : Fm Explain the factors that responsible

    Explain the factors that responsible for the recent surge in international portfolio investment (IPI)?

  • Q : What is Extreme Value Theory What is

    What is Extreme Value Theory?