In 1977, Phelim Boyle published a paper called “Options: A Monte Carlo Approach” where he explored the use of Monte Carlo simulations in pricing financial instruments known as options. Options are essentially contracts that give the contract holder the right (not obligation) to buy or sell an underlying asset at an exercise price stated on […]

Besides using Monte Carlo methods to approximate area or volume, as seen in the book, we can also use it for a more “frivolous” purpose. Many online poker calculators use Monte Carlo simulation to analyse the strength of poker hands. Given a deck of 52 cards, we introduce constraints of the 2-card holding of the player, […]

We might not realize it, but everytime we use Adobe Photoshop, we’re actually using interpolation techniques. Think about it this way - what happens when we resize/rotate/enlarge a photograph? There are only so many pixels involved in the image, that we will need to infer the type of pixel that we will need to fill […]