Become A Member

This article primary objective was to provide a concise introduction to stable distributions in the context of financial modelling. Due to the inadequacy of the normal (or bell curve/Gaussian) model in capturing the significant variations observed in actual assets, it is imperative to employ more effective models for calculating financial returns. The Laplace distribution is a category of probability distributions with heavy tails that can effectively represent substantial fluctuations and accommodate a broader range of dependence patterns