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Sensitivity Analysis of Catastrophe Bond Priceunder the Hull–White Interest Rate Model
Mälardalen University, School of Education, Culture and Communication, Educational Sciences and Mathematics. (MAM)ORCID iD: 0000-0002-0139-0747
Mälardalen University, School of Education, Culture and Communication, Educational Sciences and Mathematics. Swedbank, Sweden. (MAM)
Mälardalen University, School of Education, Culture and Communication, Educational Sciences and Mathematics. (MAM)
2016 (English)In: Engineering Mathematics I: Electromagnetics, Fluid Mechanics, Material Physics and Financial Engineering / [ed] Sergei Silvestrov; Milica Rancic, Springer, 2016Chapter in book (Refereed)
Abstract [en]

We consider a model, where the natural risk index is described by the Merton jump-diffusion while the risk-free interest rate is governed by the Hull–White stochastic differential equation. We price a catastrophe bond with payoff depending on finitely many values of the underlying index. The sensitivities of the bond price with respect to the initial condition, volatility of the diffusion component, and jump amplitude, are calculated using the Malliavin calculus approach.

Place, publisher, year, edition, pages
Springer, 2016.
Series
Springer Proceedings in Mathematics and Statistics, ISSN 2194-1009 ; 178
National Category
Probability Theory and Statistics
Research subject
Mathematics/Applied Mathematics
Identifiers
URN: urn:nbn:se:mdh:diva-33387ISBN: 978-3-319-42081-3 (print)ISBN: 978-3-319-42082-0 (print)OAI: oai:DiVA.org:mdh-33387DiVA, id: diva2:1034031
Available from: 2016-10-11 Created: 2016-10-11 Last updated: 2019-01-15Bibliographically approved

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CiteExportLink to record
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Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf