Financial Markets Dynamic Distribution Function, Predictability and Investment Decision-Making (FMDDF)

Gregory Chernizer
Additional contact information
Gregory Chernizer: Financial Market Universal Dynamics, Inc

A chapter in Practical Fruits of Econophysics, 2006, pp 126-130 from Springer

Abstract: Summary FMDDF system based on the basic scientific ideas from Physics and Economics involved in the procedure for the dynamic probabilistic distribution function of the state (PDFS) derivation for any financial market (FM). Price moving process defines dynamic FM. Price movement is defined by the volume imbalance V. The necessary condition for the dynamic FM is V ≠ 0 at the same price, while the sufficient condition is defined by nonzero price volatility σ. The total probabilistic distribution function of any FM is the sum of the two incompatible terms: the regular probabilistic distribution function (PDF) containing the mean value and PDFS. PDFS structured based on the adiabatic integrals of FM motion that include the existing or expected volume imbalance, price volatility and amount of shares or contracts. PDFS is not path dependable (the new trajectories’ invariant principle) in the special economic space E{ξ}. This fact is important in financial engineering, risk control, quantitative FM predictability and investment decision-making.

Keywords: Volume excess; adiabatic constant; state composite variable; dynamic economic space (search for similar items in EconPapers)
Date: 2006
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-4-431-28915-9_22

Ordering information: This item can be ordered from
http://www.springer.com/9784431289159

DOI: 10.1007/4-431-28915-1_22

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().