Chaos and Order in the Capital Markets: A New View of Cycles, Prices, and Market Volatility

The latest developments in chaos theory from an industry expertChaos and Order in the Capital Markets was the first book to introduce and popularize chaos as it applies to finance. It has since become the classic source on the topic. This new edition is completely updated to include the latest ripples in chaos theory with new chapters that tie in todays hot innovations, such as fuzzy logic, neural nets, and artificial intelligence.Critical praise for Peters and the first edition of Chaos and Order in the Capital MarketsThe bible of market chaologists. BusinessWeekEd Peters has written a firstclass summary suitable for any investment professional or skilled investor. Technical Analysis of Stocks & CommoditiesIt ranks among the most provocative financial books of the past few years. Reading this book will provide a generous payback for the time and mental energy expended. Financial Analysts JournalThis second edition of Chaos and Order in the Capital Markets brings the topic completely up to date with timely examples from todays markets and descriptions of the latest wave of technology, including genetic algorithms, wavelets, and complexity theory.Chaos and Order in the Capital Markets was the very first book to explore and popularize chaos theory as it applies to finance. It has since become the industry standard, and is regarded as the definitive source to which analysts, investors, and traders turn for a comprehensive overview of chaos theory. Now, this invaluable reference touted by BusinessWeek as the bible of market chaologists has been updated and revised to bring you the latest developments in the field.Mainstream capital market theory is based on efficient market assumptions, even though the markets themselves exhibit characteristics that are symptomatic of nonlinear dynamic systems. As it explores and validates this nonlinear nature, Chaos and Order repudiates the random walk theory and econometrics. It shifts the focus away from the concept of efficient markets toward a more general view of the forces underlying the capital market system.Presenting new analytical techniques, as well as reexamining methods that have been in use for the past forty years, Chaos and Order offers a thorough examination of chaos theory and fractals as applied to investments and economics. This new edition includes timely examples from todays markets and descriptions of cuttingedge technologiesgenetic algorithms, wavelets, complexity theoryand hot innovations, such as fuzzy logic and artificial intelligence.Beyond the history of current capital market theory, Chaos and Order covers the crucial characteristics of fractals, the analysis of fractal time series through rescaled range analysis (R/S), the specifics of fractal statistics, and the definition and analysis of chaotic systems. It offers an indepth exploration of:* Random walks and efficient markets the development of the efficient market hypothesis (EMH) and modern portfolio theory* The linear paradigm why it has failed* Nonlinear dynamic systems phase space, the Henon Map, Lyapunov exponents* Applying chaos and nonlinear methods neural networks, genetic algorithms* Dynamical analysis of time series reconstructing a phase space, the fractal dimensionTonis Vagas Coherent Market Hypothesis the theory of social imitation, control parameters, Vagas implementationsPlus, Chaos and Order now contains a Windowscompatible disk including data sets for running analyses described in the appendices.Written by a leading expert in the field, Chaos and Order in the Capital Markets has all the information you need for a complete, uptodate look at chaos theory. This latest edition will undoubtedly prove to be as invaluable as the first.