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arxiv: math/0311144 · v1 · submitted 2003-11-10 · 🧮 math.PR · q-fin.PR

A model of the term structure of interest rates based on L\'evy fields

classification 🧮 math.PR q-fin.PR
keywords modelfieldinterestratesabsentcasecoefficientsdeterministic
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An extension of the Heath--Jarrow--Morton model for the development of instantaneous forward interest rates with deterministic coefficients and Gaussian as well as L\'evy field noise terms is given. In the special case where the L\'evy field is absent, one recovers a model discussed by D.P.~Kennedy.

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