2204 CHAPTER 64. WIENER PROCESSES

because ψk (t j)−ψk(t j−1

)is normally distributed having variance t j− t j−1 and mean 0.

Now letting N→ ∞, this implies

E

(exp

m

∑j=1

i(h j,W (t j)−W

(t j−1

))U

)

=m

∏j=1

exp

(−1

2(t j− t j−1

) ∞

∑k=1

λ k (h j,ek)2U

)

=m

∏j=1

exp(−1

2(t j− t j−1

)(Qh,h)U

)=

m

∏j=1

exp(i(h j,W (t j)−W

(t j−1

))U

)(64.5.25)

because of the fact shown above that (h,W (t)−W (s)) is normally distributed with mean 0and variance (t− s)(Qh,h). By Theorem 59.13.3 on Page 1898, this shows the incrementsare independent.

Next consider the continuity assertion. Recall

W (t) =∞

∑k=1

√λ kekψk (t)

where ψk is a real Wiener process. Therefore, letting 2m > 2,m ∈ N and using 64.1.3 forψk and Jensen’s inequality along with Lemma 64.3.1,

E(|W (t)−W (s)|2m

)= E

∣∣∣∣∣ ∞

∑k=1

√λ kek (ψk (t)−ψk (s))

∣∣∣∣∣2m

= E

((∞

∑k=1

λ k |ψk (t)−ψk (s)|2

)m)

≤ E

( ∞

∑k=1

λ k

)m−1∞

∑k=1

λ k |ψk (t)−ψk (s)|2m

≤ Cm

∑k=1

λ kE(|ψk (t)−ψk (s)|

2m)

(64.5.26)

≤ Cm |t− s|m (64.5.27)

By the Kolmogorov Čentsov Theorem, Theorem 62.2.2, it follows that off a set of measure0, t→W (t,ω) is Holder continuous with exponent γ such that

γ <m−1

2m.

Finally, from 64.5.24 taking r = 1,

E (exp i(h,W (t)−W (s))U ) = exp(−1

2(t− s)(Qh,h)

)

2204 CHAPTER 64. WIENER PROCESSESbecause YW; (tj) — Y; (t;-1) is normally distributed having variance t; — tj; and mean 0.Now letting N — ©, this implies£ (oo Lith. )-W OM)Inn= ITswie= expml jatj-i ) Eatink=l— tj] ) (Qh)no.IlannielIjoanexp (i (h;,W (t;) — W (t;-1)) 4) (64.5.25)nan.ll.because of the fact shown above that (h, W (t) — W (s)) is normally distributed with mean 0and variance (t — s) (Qh,h). By Theorem 59.13.3 on Page 1898, this shows the incrementsare independent.Next consider the continuity assertion. RecallN=Y Vareryi(t)k=1where y;, is a real Wiener process. Therefore, letting 2m > 2,m € N and using 64.1.3 fory, and Jensen’s inequality along with Lemma 64.3.1,2m¥ Viveu( (Wx (4) — Wx (8)= AG Ale (0) weE (\W (0) —W(s)P")S e((Ze _ Lalvil Wx (8)S Cn Yea wE (70 )— vi (s)P") (64.5.26)Ss Cult (64.5.27)By the Kolmogorov Centsov Theorem, Theorem 62.2.2, it follows that off a set of measure0, t + W (t, @) is Holder continuous with exponent y such thatm—1Ys 2mFinally, from 64.5.24 taking r = 1,E (expi(.W (2) W(3))y)=exp (—3 (0-5) (ON.0))