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Title: A quantum mechanical model for the relationship between stock price and stock ownership

Abstract

The trade of a fixed stock can be regarded as the basic process that measures its momentary price. The stock price is exactly known only at the time of sale when the stock is between traders, that is, only in the case when the owner is unknown. We show that the stock price can be better described by a function indicating at any moment of time the probabilities for the possible values of price if a transaction takes place. This more general description contains partial information on the stock price, but it also contains partial information on the stock owner. By following the analogy with quantum mechanics, we assume that the time evolution of the function describing the stock price can be described by a Schroedinger type equation.

Authors:
 [1]
  1. Faculty of Economic Cybernetics, Statistics and Informatics, Academy of Economic Studies, 6 Piata Romana, 010374 Bucharest (Romania)
Publication Date:
OSTI Identifier:
22075697
Resource Type:
Journal Article
Journal Name:
AIP Conference Proceedings
Additional Journal Information:
Journal Volume: 1497; Journal Issue: 1; Conference: AMEE '12: 38. international conference applications of mathematics in engineering and economics, Sozopol (Bulgaria), 8-13 Jun 2012; Other Information: (c) 2012 American Institute of Physics; Country of input: International Atomic Energy Agency (IAEA); Journal ID: ISSN 0094-243X
Country of Publication:
United States
Language:
English
Subject:
71 CLASSICAL AND QUANTUM MECHANICS, GENERAL PHYSICS; 97 MATHEMATICAL METHODS AND COMPUTING; EVOLUTION; MARKET; PRICES; QUANTUM MECHANICS; SALES; SCHROEDINGER EQUATION; TRADE

Citation Formats

Cotfas, Liviu-Adrian. A quantum mechanical model for the relationship between stock price and stock ownership. United States: N. p., 2012. Web. doi:10.1063/1.4766764.
Cotfas, Liviu-Adrian. A quantum mechanical model for the relationship between stock price and stock ownership. United States. doi:10.1063/1.4766764.
Cotfas, Liviu-Adrian. Thu . "A quantum mechanical model for the relationship between stock price and stock ownership". United States. doi:10.1063/1.4766764.
@article{osti_22075697,
title = {A quantum mechanical model for the relationship between stock price and stock ownership},
author = {Cotfas, Liviu-Adrian},
abstractNote = {The trade of a fixed stock can be regarded as the basic process that measures its momentary price. The stock price is exactly known only at the time of sale when the stock is between traders, that is, only in the case when the owner is unknown. We show that the stock price can be better described by a function indicating at any moment of time the probabilities for the possible values of price if a transaction takes place. This more general description contains partial information on the stock price, but it also contains partial information on the stock owner. By following the analogy with quantum mechanics, we assume that the time evolution of the function describing the stock price can be described by a Schroedinger type equation.},
doi = {10.1063/1.4766764},
journal = {AIP Conference Proceedings},
issn = {0094-243X},
number = 1,
volume = 1497,
place = {United States},
year = {2012},
month = {11}
}