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Estimation for the change point of the volatility in a stochastic differential equation

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Author Info
Stefano Iacus (Department of Economics, Business and Statistics, University of Milan, IT)
Nakahiro Yoshida (Graduate School of Mathematical Sciences, Tokyo University, Tokyo)

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Abstract

We consider a multidimensional Ito process Y=(Y_t), t in [0,T], with some unknown drift coefficient process b_t and volatility coefficient sigma(X_t,theta) with covariate process X=(X_t), t in[0,T], the function sigma(x,theta) being known up to theta in Theta. For this model we consider a change point problem for the parameter theta in the volatility component. The change is supposed to occur at some point t* in (0,T). Given discrete time observations from the process (X,Y), we propose quasi-maximum likelihood estimation of the change point. We present the rate of convergence of the change point estimator and the limit thereoms of aymptotically mixed type.

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Publisher Info
Paper provided by Universitá degli Studi di Milano in its series UNIMI - Research Papers in Economics, Business, and Statistics with number 1084.

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Date of creation: 18 Jun 2009
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Handle: RePEc:bep:unimip:1084

Note: oai:cdlib1:unimi-1084
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Related research
Keywords: It\^o processes; discrete time observations; change point estimation; volatility;

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This page was last updated on 2009-12-20.


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