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Hedging Autocall in SLV or LV
Hi all,I have two questions related to autocalls in stochastic local vol (SLV) and Local Vol (LV) models :1- Why do we need to price autocalls in SLV and not LV ? My understanding is that the LV undestates the forward vol smile hence we overprice the value of the knock-in put in an LV model. Is this a valid reason ? Is there another reason for that ?2- What is the difference between hedging an autocall in SLV rather than LV ?Many thanks