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Default times, non arbitrage conditions and change of probability measures

2008/12/21 by Delia Coculescu, Coculescu, Delia, Monique Jeanblanc +3
Mathematics · #FOS: Mathematics #Probability (math.PR) #math.PR

paper · pdf · doi:10.48550/arxiv.0812.4064

arxiv created 2008/12/21 · arxiv updated 2009/12/01

Abstract

In this paper we give a financial justification, based on non arbitrage conditions, of the (H) hypothesis in default time modelling. We also show how the (H) hypothesis is affected by an equivalent change of probability measure. The main technique used here is the theory of progressive enlargements of filtrations.

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