This study gives an outline of modern theory of classification and regression trees (CART) and shows the advantages of CART applications in finance. Practical issues regarding CART applications and core implementation are presented. The second part of the work is mainly concentrated on DAX30...

In this master thesis a mechanism to test mononicity of empirical pricing kernels (EPK) is presented. By testing monotonicity of pricing kernel we can determine whether utility function is concave or not. Strictly decreasing pricing kernel corresponds to concave utility function while...