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Answer by user16651 for How does one calibrate a stochastic volatility model?
Indeed parameters are selected so that the quoted option prices are as closeas possible to the model option prices. Alternatively, quoted and model impliedvolatilities can be used instead of prices.The...
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I will try to use SABR Model to price call options in FX market. What does it mean to calibrate the model? As far as my understanding of the Wikipedia article goes, it means to estimate the parameters....
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