In today's world, we are increasingly exposed to the words "machine learning" (ML), a term which sounds like a panacea designed to cure all problems ranging from image recognition to machine language translation.

This book discusses the interplay of stochastics (applied probability theory) and numerical analysis in the field of quantitative finance. The stochastic models, numerical valuation techniques, computational aspects, financial products, and risk management applications presented will enable readers to progress in the challenging field of computational finance.

When the behavior of financial market participants changes, the corresponding stochastic mathematical models describing the prices may...