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Cluster Analysis on Locally Asymptotically Self-similar Processes with Known Number of Clusters

2018-04-13 · Qidi Peng, Nan Rao, Ran Zhao

We conduct cluster analysis on a class of locally asymptotically self-similar stochastic processes, which includes multifractional Brownian motion as a representative. When the true number of clusters is supposed to be known, a new covariance-based dissimilarity measure is introduced, from which we obtain the approximately asymptotically consistent clustering algorithms. In simulation studies, clustering data sampled from multifractional Brownian motions with distinct functional Hurst parameters illustrates the approximated asymptotic consistency of the proposed algorithms. Clustering global financial markets' equity indexes returns and sovereign CDS spreads provides a successful real world application.

📄 PDF Abstract BibTeX arXiv:1804.06234

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Clustering

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