Abstract
This appendix describes the concept of a stochastic process and describes the stochastic processes that are most commonly used to model commodity prices.
Stochastic Processes
A variable whose value changes randomly over time follows a stochastic process. Processes of this type can be classified as discrete-time or continuous-time processes. In a discrete-time stochastic process, the value of the variable changes only at certain fixed time points, whereas in a continuous-time stochastic process such changes may occur at any time.
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Lazo, J.G.L. (2009). Appendix C – Stochastic Processes. In: Pacheco, M.A.C., Vellasco, M.M.B.R. (eds) Intelligent Systems in Oil Field Development under Uncertainty. Studies in Computational Intelligence, vol 183. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-93000-6_10
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DOI: https://doi.org/10.1007/978-3-540-93000-6_10
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