Stochastic calculus
I do not have any background in Maths or Science and I have decided to learn stochastic calculus on my own (from books).
What I am attempting here in my blog is to translate what I have learnt about stochastic calculus. I hope it will be of benefit to people who do not have academic background in quantitative analysis (or mathematics and statistics). I am planning to add at least one article every week. So if you want to understand exactly what it is that the quants do then please read all articles from beginning to end.
Read each article very slowly, explore other blogs on the same subject and hopefully it will start making sense. Believe me this is not a rocket science. All you need is some experience in stock market and options.
Before attempting this task, I have spent 2-3 month studying calculus. I bought Maths and Stats Video from teach12.com. I also studied algebra, probability, precalculus and calculus books. The books are cheap and you can get them in any second hand or college book shop, just make sure that you force yourself to solve all problems. The lecture video from teach12.com are great but not exactly cheap. However, there are a few other websites offerring free lectures, just search the net for "free calculus video'.
I might as well warn you that It is absolutely vital to get your brain up and running before taking on stochastic calculus.
If you find anything confusing then email me stochastic@systomatics.info Best of luck!
Continue reading: article 1 of n or use the index below.
1. Delta hedging formulae Part I
2. Delta hedging formulae Part II
3. Finite probability space, probability measure, events, random variable and distributions
6. Martingales
8. Simple model for asset prices
10. Arithmatic brownian motion
13. Radon-Nikodym
14. Reinforcing the concept of derivative
15. Simple capital asset modeling problem
18. Revisiting Partial derivatives
