Application of Mathematical Equations to Describing Fast Changes in the Assets Prices

14 Pages Posted: 28 Sep 2015

Date Written: September 26, 2015

Abstract

Price dynamics of the asset depends on the collective action of buyers and sellers, including both institutional and private investors. A large number of diverse, sometimes contradictory, reasons can underlie the decisions of market participants. In certain periods, asset purchases can be a prevailing action, leading to a fast growth of the asset price. Thus, an accelerating price growth occurs.

In natural sciences, any motion or process is determined by the appropriate law described in terms of mathematical equations. This statement raises the questions: whether the financial market is also determined by such laws that hold true throughout certain time periods and whether the mathematical equations can be derived to describe these laws.

Keywords: Price dynamics, asset price, mathematical equations, growth rate

JEL Classification: C00, G12

Suggested Citation

Baryshevsky, Dmitry V., Application of Mathematical Equations to Describing Fast Changes in the Assets Prices (September 26, 2015). Available at SSRN: https://ssrn.com/abstract=2666022 or http://dx.doi.org/10.2139/ssrn.2666022

Dmitry V. Baryshevsky (Contact Author)

Financial Analysis Group ( email )

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