Stochastic Modeling and Its Applications - ACS 654

This course introduces students to the continuous-time models that underpin modern financial theory, with a focus on stochastic calculus and its applications. Students will develop a rigorous understanding of Brownian motion, Ito’s Lemma, stochastic differential equations (SDEs), and the Black-Scholes framework. The course emphasizes both the theoretical foundations and real-world applications to option pricing, risk management, and portfolio optimization.