how to computet the entropy of an economic system and tendency to entropy/disorder
Entropy of an economic system
- Thread starter stock_trad3r
- Start date
Tsallis entropy as applied to the stock market:
Scroll to eqs 3 & 11. Not a simple calculation. Also, they look at deep out of the money options skewness to determine possible crash potential.
http://www.sfu.ca/~rgencay/jarticles/crash.pdf
Make sure to post the graph if you are able to replicate their work for today's market.
Scroll to eqs 3 & 11. Not a simple calculation. Also, they look at deep out of the money options skewness to determine possible crash potential.
http://www.sfu.ca/~rgencay/jarticles/crash.pdf
Make sure to post the graph if you are able to replicate their work for today's market.