Modeling Stock Market Based on Genetic Cellular Automata

Physics – Condensed Matter – Other Condensed Matter

Scientific paper

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5 pages, 4 figures, to be published in <Int. J. Mod. Phys. B>

Scientific paper

10.1142/S0217979204025932

An artificial stock market is established with the modeling method and ideas of cellular automata. Cells are used to represent stockholders, who have the capability of self-teaching and are affected by the investing history of the neighboring ones. The neighborhood relationship among the stockholders is the expanded Von Neumann relationship, and the interaction among them is realized through selection operator and crossover operator. Experiment shows that the large events are frequent in the fluctuations of the stock price generated by the artificial stock market when compared with a normal process and the price returns distribution is a Levy distribution in the central part followed by an approximately exponential truncation.

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