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Dealing with Stochastic Volatility in Time Series Using the R Package stochvol

Gregor Kastner

arXiv 28 Jun 2019 · Statistics — Computation · publishedJournal of Statistical Software (2016) · 130 citations (OpenAlex)

arXiv:1906.12134 · PDF · DOI · OpenAlex · Extracted main text

Abstract

The R package stochvol provides a fully Bayesian implementation of heteroskedasticity modeling within the framework of stochastic volatility. It utilizes Markov chain Monte Carlo (MCMC) samplers to conduct inference by obtaining draws from the posterior distribution of parameters and latent variables which can then be used for predicting future volatilities. The package can straightforwardly be employed as a stand-alone tool; moreover, it allows for easy incorporation into other MCMC samplers. The main focus of this paper is to show the functionality of stochvol. In addition, it provides a brief mathematical description of the model, an overview of the sampling schemes used, and several illustrative examples using exchange rate data.

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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
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2Kastner G, Frühwirth-Schnatter S (2014) Ancillarity-Sufficiency Interweaving Strategy (ASIS) for Boosting MCMC Estimation of Stochastic Volatility Models0.73732100%
3Genz A, Bretz F, Miwa T, Mi X, Leisch F, Scheipl F, Hothorn T (2013) mvtnorm: Multivariate Normal and t Distributions0.64422100%
4R Core Team (2016) R: A Language and Environment for Statistical Computing0.64422100%
5Omori Y, Chib S, Shephard N, Nakajima J (2007) Stochastic Volatility With Leverage: Fast and Efficient Likelihood Inference0.58531100%
6Bollerslev T (1986) Generalized Autoregressive Conditional Heteroskedasticity0.40511100%
7Bos CS (2012) Relating Stochastic Volatility Estimation Methods0.40511100%
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9Engle RF (1982) Autoregressive Conditional Heteroscedasticity With Estimates of the Variance of United Kingdom Inflation0.40511100%
10Frühwirth-Schnatter S, Wagner H (2010) Stochastic Model Specification Search for Gaussian and Partial Non-Gaussian State Space Models0.40511100%

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