Compound Poisson and Poisson process approximations for occurrences of multiple words in Markov chains

We derive a Poisson process approximation for the occurrences of clumps of multiple words and a compound Poisson process approximation for the number of occurrences of multiple words in a sequence of letters generated by a stationary Markov chain. Using the Chen-Stein method, we provide a bound on the error in the approximations. For rare words, these errors tend to zero as the length of the sequence increases to infinity. Modeling a DNA sequence as a stationary Markov chain, we show as an application that the compound Poisson approximation is efficient for the number of occurrences of rare stem-loop motifs.