Is it so bad that we cannot recognize black swans?

Fuad Aleskerov and Lyudmila Egorova ()

Economics Letters, 2012, vol. 117, issue 3, 563-565

Abstract: We present processes on stock exchange as two random processes one of which reflects the regular regime of economy and the other one–crises. If regular processes are correctly recognized with the probability slightly higher than 1/2, this gives positive average gain to the player. We believe that this very phenomenon lies on the basis of unwillingness of people to expect crises permanently and to try recognizing them.

Keywords: Financial crises; Stock exchange; Poisson processes (search for similar items in EconPapers)
JEL-codes: G1 G2 (search for similar items in EconPapers)
Date: 2012
References: View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:117:y:2012:i:3:p:563-565

DOI: 10.1016/j.econlet.2012.04.078

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