Copied Introductory Lectures on Fluctuations of Lvy Processes with Applications
Introductory Lectures on Fluctuations of Lvy Processes with Applications
Lvy processes are the natural continuous-time analogue of random walks and form a rich class of stochastic processes around which a robust mathematical theory exists. Their mathematical significance is justified by their application in many areas of classical and modern stochastic models. This textbook forms the basis of a graduate course on the theory and applications of Lvy processes, from the perspective of their path fluctuations. Central to the presentation are decompositions of the paths of Lvy processes in terms of their local maxima and an understanding of their short- and long-term behaviour. The book aims to be mathematically rigorous while still providing an intuitive feel for underlying principles. The results and applications often focus on the case of Lvy processes with jumps in only one direction, for which recent theoretical advances have yielded a higher degree of mathematical transparency and explicitness. Each chapter has a comprehensive set of exercises with complete solutions.
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