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"Calibrating with a smile: A Mellin transform approach to volatility su" by M. Rodrigo and A. Lo

The implied volatility in the Black-Scholes framework is not a constant but a function of both the strike price (“smile/skew”) and the time to expiry. A popular approach to recovering the volatility surface is through the use of deterministic volatility function models via Dupire's equation. A new method for volatility surface calibration based on the Mellin transform is proposed. An explicit formula for the volatility surface is obtained in terms of the Mellin transform of the call opt...
Deterministic Volatility Function Upires Equation Inverse Problem Ellin Transform Volatility Surface
Source: uow.edu.au

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