Truth and Beauty: Finance in Econophysical Translation

17 Aestimatio 130-147 (2018)

18 Pages Posted: 10 Nov 2017 Last revised: 25 Aug 2018

See all articles by James Ming Chen

James Ming Chen

Michigan State University - College of Law

Date Written: November 8, 2017


My recent book, Econophysics and Capital Asset Pricing: Splitting the Atom of Systematic Risk, splits beta, the capital asset pricing model’s basic unit of systematic risk, into subatomic (or “baryonic”) components, by analogy to the Standard Model of particle physics. This essay offers preliminary thoughts on the application of physics to other dimensions of finance. A more comprehensive approach would integrate Econophysics and Capital Asset Pricing’s spatial representation of comovement between individual firms, capital markets, and the real economy, with the informational and temporal dimensions of finance. This essay also places efforts at representing finance through physics in their broader scientific and aesthetic context.

Keywords: econophysics, capital asset pricing, CAPM, physics, efficient market hypothesis, comovement, procyclicality

JEL Classification: A12, B26, G12

Suggested Citation

Chen, James Ming, Truth and Beauty: Finance in Econophysical Translation (November 8, 2017). 17 Aestimatio 130-147 (2018). Available at SSRN: or

James Ming Chen (Contact Author)

Michigan State University - College of Law ( email )

318 Law College Building
East Lansing, MI 48824-1300
United States

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