PDE Parameters

Explanation of Input Parameters

  • Xmin: Defines the lower bound for the state space in the PDE grid.
  • Xmax: Defines the upper bound for the state space in the PDE grid.
  • Theta:A fixed numerical scheme parameter that determines whether an Implicit scheme (Theta=1), an Explicit scheme (Theta=0), or a Crank-Nicolson scheme (Theta=0.5) is used. Theta is fixed at 0.5.
  • Number of States: Specifies the discretization level for the state variable in the PDE solver.
  • Time Steps: Defines the number of time discretization steps for solving the PDE.
  • Number of Pools: Specifies the number of additional PDE grids used to model path dependency. Increasing the number of grids improves precision but results in longer calculation times.