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Forecasting Irregularly Spaced UHF Financial Data: Realized Volatility vs UHF-GARCH Models

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Author Info
Francois-Éric Racicot () (Département des sciences administratives, Université du Québec (Outaouais) et LRSP)
Raymond Théoret () (Département de stratégie des affaires, Université du Québec (Montréal))
Alain Coen () (Département de stratégie des affaires, Université du Québec (Montréal))

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Abstract

A very promising literature has been recently devoted to the modeling of ultra-high-frequency (UHF) data. Our first aim is to develop an empirical application of Autoregressive Conditional Duration GARCH models and the realized volatility to forecast future volatilities on irregularly spaced data. We also compare the out sample performances of ACD GARCH models with the realized volatility method. We propose a procedure to take into account the time deformation and show how to use these models for computing daily VaR.

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File URL: http://www.repad.org/ca/qc/uq/uqo/dsa/RealizedVolatilityandUHF_repad_juillet_2006.pdf
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File Function: First version, 2006
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Publisher Info
Paper provided by Département des sciences administratives, UQO in its series RePAd Working Paper Series with number UQO-DSA-wp152006.

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Length: 27 pages
Date of creation: 06 Jul 2006
Date of revision:
Handle: RePEc:pqs:wpaper:152006

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Related research
Keywords: Realized volatility Ultra High Frequency GARCH time deformation financial markets Daily VaR.

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Find related papers by JEL classification:
C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models
C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Other Model Applications
G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies

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This page was last updated on 2008-11-17.


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