Stochastic Calculus: Levy Processes And

: A pure jump process typically used to model arrival times or discrete events.

: Changes in the process over non-overlapping time intervals do not influence each other. Levy processes and stochastic calculus

: Used to change probability measures, a vital step in risk-neutral pricing for options. Real-World Applications : A pure jump process typically used to

Traditional calculus fails when dealing with the non-differentiable paths of random processes. Stochastic calculus provides the tools to integrate and differentiate these paths, which is critical for: which is critical for: