The log-optimal strategy in gambling and asset allocation problem attempts to maximize the expectation of the logarithmic rate of return but not the gross wealth itself. This strategy has been shown to have long termsuperiority overother strategies in theory. Another remarkable virtue is it allows updating the real-time market information quickly which could increase of the logarithmic rate of return. We will prove these properties ourselves in a simple way. We further consider how to do asset allocation by applying the log-optimal strategy in practice. The distribution function of the returns is usually unknown and need to be estimated from the history in a real world. The estimation error will affect the asset allocation directly, but such effect mayresult in a "butterfly effect" which could bring an investment disaster. Therefore, it is an important issue to answer whether there is logoptimal strategy resisted "butterfly effect". We develop a new log-optimal strategy based on the allocation utility which is a quadratic approximation to the expectation of the logarithmic rate of return. We show that the upper bound of the allocation utility deviation can be controlled by the l_1-norm of portfolio and l_∞-norm of the bias of variance matrix estimator. This turns out that our proposed strategy is robust. We apply our strategy for NYSE data. The results showed that our strategy has high performance in return.

An important property for finite difference schemes designed on curvilinear meshes is the exact preservation of free-stream solutions. This property is difficult to fulfill for high order conservative essentially non-oscillatory (WENO) finite difference schemes. In this paper we explore an alternative flux formulation for such finite difference schemes which can preserve free-stream solutions, based on the numerical technique for the metric terms, which can be applied to this alternative flux formulation but is difficult to be applied to the standard finite difference formulation. Free-stream and vortex preservation properties are investigated, and comparison with standard finite difference WENO schemes is made. Theoretical derivation and numerical results show that the finite difference WENO schemes based on the alternative flux formulation can preserve free-stream and vortex solutions on both stationary and dynamically generalized coordinate systems, hence giving much better performance than the standard finite difference WENO schemes for such problems.

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This note discusses the recent work of Huang-Schoen-Wang [13] on specifying total conserved quantities of a vacuum initial data set.

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