Abstract
Collective behaviour sums up the emotional and rational actions of many individuals. In the financial markets, the economic agents’ aggregate activity leads to price fluctuations driven by hope and fear, optimism and pessimism. While the market mood mechanism is unknown, a number of hypotheses exist including the suggestion that the mind’s complex cognitive processes scale up to the domain of socioeconomic activity. Here we show how a neurocomputational model for primitive individual emotion and memory can predict the highest and lowest daily prices of NASDAQ-traded companies. The model, known as the Grossberg–Schmajuk recurrent gated dipole, beats some state-of-the-art econometric tools for emotion–influenced financial data. This finding comprises an indirect evidence for the existence of a fractal projection from individual to collective cognition.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
