Finite Difference Methods For Option Pricing

In finance, the term “finite difference methods” are a type of optimization that can be used to solve problems in option pricing.

The most common finite difference methods are the gradient descent method, the maximum likelihood method, and the moments method.

The gradient descent method is a simple algorithm that is used to find a good solution to a problem where there are several possible solutions.

The maximum likelihood method is used to find the best solution to a problem where there are only a few possible solutions.

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