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Technology & AIJul 29, 2026

Inverse Learning of Latent Risk-Neutral Densities from Irregular Option Quotes

Accurate option prices do not imply accurate recovery of the latent risk-neutral density.

Accurate option prices do not imply accurate recovery of the latent risk-neutral density. We study this distinction with two complementary benchmarks. A controlled benchmark exposes simulator-truth densities for latent evaluation, while a chronological NIFTY benchmark tests only…

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