Market Topology by Nicolas Vandewalle, Ph.D.
ARTICLE SYNOPSIS ...Market Topology by Nicolas Vandewalle, Ph.D.
Stock W affects stock X, which in turn affects stock Y, which drives stock Z. How do you work out all the interconnectivity? By using a market tree.
No single indicator seems to represent the global (or local) structure of the market. It is possible to group stocks by sectors and to assume that stocks in the same basket are highly correlated, but doing so leaves the structure within a sector and the relationships between sectors unspecified. Is an objective representation of the market's structure possible? Could such a representation lead to a gl...
AUTHOR: Nicolas Vandewalle, Ph.D.DATE: DEC 2000SUBJECT: New Techniques