Introduction

Abstract

Stochastic calculus is used in finance and econom(etr)ics for instance for solving stochastic differential equations and handling stochastic integrals. This requires stochastic processes. Although stemming from a rather recent area of mathematics, the methods of stochastic calculus have shortly come to be widely spread not only in finance and economics. Moreover, these techniques – along with methods of time series modeling – are central in the contemporary econometric tool box. In this introductory chapter some motivating questions are brought up being answered in the course of the book, thus providing a brief survey of the topics treated.