simulate stock prices using standard normal distribution

Hi all,

I am new to MATLAB and I want to simulate market index and

company stock prices using normal distribution in MATLAB.Company prices should be linked to market through correlation.simulate stock prices

Any help will be appreciated.

Answer 1

[Abhisek Pradhan]

Following link illustrate a method to simulate equity prices.

https://www.mathworks.com/help/finance/example-simulating-equity-prices.html#briccop

As stocks generally refers to traded Equity. So, the provided workflow may be used to simulate stock prices as well.

While creating a sde object change the Simulation property to Normal Distribution, which is by default simByEuler.

To get a function_handle for Normal Distribution use normpdf.

[Sana Ejaz]

My supervisor don't want me to use packages so I want a simple method to simulate prices.I want to simulate market prices first and my company prices should then be created from market prices using correlation coefficient.I meant to say my market simulated prices should be related to company simulated prices thorugh correlation.

Does it make sense ?