• Apr 13, 2026 monte carlo methods in financial engineering stoch Dynamics At the heart of Monte Carlo methods in finance lies the modeling of asset prices through stochastic processes, most notably: Geometric Brownian Motion (GBM): Used in the Black-Scholes model, where the asset price \( S_t \) evolves as: \[ dS_t = \mu S_t dt + \sigma S_t dW_t \] By Andrew Denesik-Considine IV
