This paper studies the behavior of the implied volatility function (smile) when the true distribution of the underlying asset is consistent with the stochastic volatility model proposed by Heston (1993). The main result of the paper is to extend previous results applicable to the smile as a...

It is usually assumed that maximal elements are the best option for an agent. But there are situations in which we can observe that maximal elements are “different” one from another. This is the case of partial orders, in which one maximal element can be strictly preferred to almost every...