Utilizing Topographic Finance to Understand Volatility
18 Pages Posted: 7 Apr 2015
Date Written: April 6, 2015
Visual representation methods are a common problem in econometrics and finance in order to describe system dynamics. In this paper we address this problem by using the bi-harmonic oscillation process and the Brownian motion components, to generate a three-dimensional volatility surface.
The empirical analysis have been carried out on the S&P500 Index, the 10-year US Treasury Rates, and the West Texas Intermediate oil price, by using 85 daily closing observations, at the purpose to show how visualization of volatility can help understand longitudinal movements of price within different asset classes.
Keywords: Volatility, Equities, Bonds, Oil, Surfaces, Trading
JEL Classification: G00, C53, C88
Suggested Citation: Suggested Citation