Moderne Finanzmathematik - Theorie und praktische Anwendung Band 2

This book and the accompanying first volume on option pricing and portfolio optimization provide a thorough introduction to the methods and principles of modern financial mathematics. This second volume specifically addresses interest rate modeling, generalizations of the Black-Scholes model for a more realistic modeling of stock prices, as well as parameter estimation and calibration. To facilitate the reading and understanding of all chapters, introductory sections with motivation and an overview are provided at the beginning of each chapter, where the material that follows is economically motivated, its origin and development history is described, or practical aspects are presented. Technically demanding theoretical concepts are introduced in excursions where they are first needed. The work is aimed at students of mathematics and finance.