The phrase "a valuation problem" is correct and usable in written English.
It can be used in contexts related to finance, economics, or any situation where assessing the value of an asset or entity is necessary.
Example: "The company is facing a valuation problem that could impact its ability to attract investors."
Alternatives: "an appraisal issue" or "a valuation challenge".
In contrast, this property will typically fail to hold when a valuation problem is global, so that (64) becomes a generalized BSDE.
In the context of the huge gains being seen in global stock prices, a significant rise in bond yields could quickly create a valuation problem very similar to the one that preceded the 1987 crash.
Under the assumptions of Proposition 6, if a valuation problem is local, then for any contract Open image in new window the hedger's gained value and the hedger's ex-dividend price satisfy (p^{e}_{t} x,mathcal {C})= p^{g}_{t} x,mathcal {C}^{t})) for all t∈[0,T].
Example 1 As a stylized example of a global valuation problem, let us consider a contract, which lasts for two months (for concreteness, assume that it is a simple combination of the put and the call on the stock S1 with maturities equal to one month and two months, respectively).
In contrast, the situation where the inputs depend on the past history of the processes is harder to address, since a global valuation problem requires to study a generalized BSDE with non-anticipative functionals.
From Lemma 5, we deduce that a local valuation problem can be formulated in terms of a classical BSDE.
Companies that stick with options will still be faced with a difficult valuation problem.
Otherwise, it is referred to as a global valuation problem.
The property of a local valuation problem established in Proposition 7 is fairly general: its validity hinges on the existence and uniqueness of a solution to a common BSDE for the gained value and the ex-dividend price.
We thus contend that the proxy for the exit value (p^{m}_{t} (x,mathcal {C}) := - p^{e}_{t} x,mathcal {C})) could be more suitable for most practical purposes when facing a global valuation problem.
Unfortunately, a practical implementation of Definition 23 could prove difficult, especially when dealing with a global valuation problem, since it would require to keep track of past cash flows from the contract and gains from the hedging strategy (of course, provided the hedging strategy was implemented by the hedger).
