I have been told that Ito's lemma serves as the stochastic calculus counterpart of the chain rule. And yet again my tutor mentioned it is not used for all stochastic processes. Is this statement ...
If I understand right, Itô's lemma tells us that for any process $X$ that can be adapted to an underlying standard normal Wiener measure $\mathrm dB_t$, and any twice continuously differentiable ...
I'm working through different books about financial mathematics and solving some problems I get stuck. Suppose you define an arbitrary stochastic process, for example $ X_t := W_t^8-8t $ where $ W_t ...