Abstract
Bacterial Foraging optimization (BFO) algorithm is a method of biologically inspired Computing, which is based on the imitation of the foraging behavior of the bacteria e. coli. This document shows how the algorithm of BFO can be built and used for the estimation of parameters in the model M-EGARCH, which is then used to calibrate the model to assess the option volatility. The results of the algorithm shows that the solid and extensible, offering the potential for application of BFO for financial modeling.