Question: What does the term diffusion refer to in the context of stochastic processes in finance? ( A ) The tendency of assets to revert to
What does the term "diffusion" refer to in the context of stochastic processes in finance?
A The tendency of assets to revert to their mean value.
B The expected difference between the value of the asset and the value of the derivative asset.
C The process of option pricing using the BlackScholes model.
D The rate of change of the underlying asset price.
E The random fluctuations in asset prices over time.
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