Dislocations

[gver]

Hi .. Probably a naive question .. do we use local versus stochastic vol models for capturing vol dislocations .. something like that we do using realized and implied vol ??

 

[financeguy]

Hi .. Probably a naive question .. do we use local versus stochastic vol models for capturing vol dislocations .. something like that we do using realized and implied vol ??

Not really sure what the analogy would be between realized/implied vol and stochastic/local vol? Short answer is I think no.