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The statistical mechanics of financial markets Johannes Voit
Publisher: Springer

Have you read Johannes Voit's book, The Statistical Mechanics of Financial Markets? This is the application of methods developed in statistical physics to the study of finance, markets, income distribution, and so on. Cite as: arXiv:1210.6321 [stat.ML]. Our results show that one of the most puzzling stylized fact in financial economies, namely that at certain times Social and Information Networks (cs.SI); Physics and Society (physics.soc-ph); Statistical Finance (q-fin.ST). Justin says: 8 January, 2011 at 5:39 am. Or at least in some models of the stock market. When you take quantum fluctuations in quantum fields, and replace time by imaginary time, you get random fluctuations in the stock market! One difference between quantum field theory and mathematical finance systems, or funding exponential earnings from finite talents and resources, etc. This highly praised introductory treatment describes the parallels between statistical physics and finance – both those established in the 100-year long interaction between these disciplines, as well as new research results on financial markets. That proves quantitative finance can be privately profitable –but not that it is profitable in general, or socially desirable. A more convincing defence of financial physics, and the sophisticated statistical analysis it deploys, is that it provides fresh perspective, revealing patterns that had been missed. Evolving models of financial markets. The examination of the words that are representative of the topic distributions confirms that our method is able to extract the significant pieces of information influencing the stock market. A famous example is Didier Sornette's use of stress analysis to predict not only earthquakes and failures of pressurised fuel tanks, but also severe crises in financial markets. Europhysics News, pages 51"“54, March/April 1998. The Statistical Mechanics of Financial Markets. But this extrapolation overestimates our ability to statistically manage reality's irreducible complexity and to eliminate uncertainty. Third, we created a model to explain the underlying ecology that gives rise to the statistical distributions seen in modern war. I must admit that initally I was attracted to this field was because of its connection to econophysics, an interdisciplinary field which mainly involved statistical mechanics to model financial markets.