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Convergence error estimate in solving free boundary diffusion problem by radial basis functions method

Zongmin Wu, Y. C. Hon

Research output: Journal Publications and ReviewsRGC 21 - Publication in refereed journalpeer-review

Abstract

The convergence error estimate in solving free boundary diffusion problem by radial basis functions (RBF) method was presented. The proposed RBF method provides a global interpolation formula for the solution as well as for the derivatives for the solution. It was found that the RBFs method provides a robust searching algorithm for the unknown optimal exercise boundary and a highly accurate approximation to the solution of the American option pricing model.
Original languageEnglish
Pages (from-to)73-79
JournalEngineering Analysis with Boundary Elements
Volume27
Issue number1
DOIs
Publication statusPublished - Jan 2003

Research Keywords

  • American options
  • Diffusion
  • Free boundary
  • Meshless
  • Radial basis functions

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