Evolvement of Uniformity and Volatility in the Stressed Global Financial Village

Background: In the current era of strong worldwide market couplings the global financial village became highly prone to systemic collapses, events that can rapidly sweep throughout the entire village. Methodology/Principal Findings: We present a new methodology to assess and quantify inter-market relations. The approach is based on the correlations between the market index, the index volatility, the market Index Cohesive Force and the meta-correlations (correlations between the intra-correlations.) We investigated the relations between six important world markets—U.S., U.K., Germany, Japan, China and India—from January 2000 until December 2010. We found that while the developed ‘‘western’’ markets (U.S., U.K., Germany) are highly correlated, the interdependencies between these markets and the developing ‘‘eastern’’ markets (India and China) are volatile and with noticeable maxima at times of global world events. The Japanese market switches ‘‘identity’’—it switches between periods of high meta-correlations with the ‘‘western’’ markets and periods when it behaves more similarly to the ‘‘eastern’’ markets. Conclusions/Significance: The methodological framework presented here provides a way to quantify the evolvement of interdependencies in the global market, evaluate a world financial network and quantify changes in the world inter market relations. Such changes can be used as precursors to the agitation of the global financial village. Hence, the new approach can help to develop a sensitive ‘‘financial seismograph’’ to detect early signs of global financial crises so they can be treated before they develop into worldwide event

Ferromagnetic semiconductors

The current status and prospects of research on ferromagnetism in semiconductors are reviewed. The question of the origin of ferromagnetism in europium chalcogenides, chromium spinels and, particularly, in diluted magnetic semiconductors is addressed. The nature of electronic states derived from 3d of magnetic impurities is discussed in some details. Results of a quantitative comparison between experimental and theoretical results, notably for Mn-based III-V and II-VI compounds, are presented. This comparison demonstrates that the current theory of the exchange interactions mediated by holes in the valence band describes correctly the values of Curie temperatures T_C magnetic anisotropy, domain structure, and magnetic circular dichroism. On this basis, chemical trends are examined and show to lead to the prediction of semiconductor systems with T_C that may exceed room temperature, an expectation that are being confirmed by recent findings. Results for materials containing magnetic ions other than Mn are also presented emphasizing that the double exchange involving hoping through d states may operate in those systems.Comment: 18 pages, 8 figures; special issue of Semicon. Sci. Technol. on semiconductor spintronic

Challenges in Complex Systems Science

FuturICT foundations are social science, complex systems science, and ICT. The main concerns and challenges in the science of complex systems in the context of FuturICT are laid out in this paper with special emphasis on the Complex Systems route to Social Sciences. This include complex systems having: many heterogeneous interacting parts; multiple scales; complicated transition laws; unexpected or unpredicted emergence; sensitive dependence on initial conditions; path-dependent dynamics; networked hierarchical connectivities; interaction of autonomous agents; self-organisation; non-equilibrium dynamics; combinatorial explosion; adaptivity to changing environments; co-evolving subsystems; ill-defined boundaries; and multilevel dynamics. In this context, science is seen as the process of abstracting the dynamics of systems from data. This presents many challenges including: data gathering by large-scale experiment, participatory sensing and social computation, managing huge distributed dynamic and heterogeneous databases; moving from data to dynamical models, going beyond correlations to cause-effect relationships, understanding the relationship between simple and comprehensive models with appropriate choices of variables, ensemble modeling and data assimilation, modeling systems of systems of systems with many levels between micro and macro; and formulating new approaches to prediction, forecasting, and risk, especially in systems that can reflect on and change their behaviour in response to predictions, and systems whose apparently predictable behaviour is disrupted by apparently unpredictable rare or extreme events. These challenges are part of the FuturICT agenda

Dominating Clasp of the Financial Sector Revealed by Partial Correlation Analysis of the Stock Market

What are the dominant stocks which drive the correlations present among stocks traded in a stock market? Can a correlation analysis provide an answer to this question? In the past, correlation based networks have been proposed as a tool to uncover the underlying backbone of the market. Correlation based networks represent the stocks and their relationships, which are then investigated using different network theory methodologies. Here we introduce a new concept to tackle the above question—the partial correlation network. Partial correlation is a measure of how the correlation between two variables, e.g., stock returns, is affected by a third variable. By using it we define a proxy of stock influence, which is then used to construct partial correlation networks. The empirical part of this study is performed on a specific financial system, namely the set of 300 highly capitalized stocks traded at the New York Stock Exchange, in the time period 2001–2003. By constructing the partial correlation network, unlike the case of standard correlation based networks, we find that stocks belonging to the financial sector and, in particular, to the investment services sub-sector, are the most influential stocks affecting the correlation profile of the system. Using a moving window analysis, we find that the strong influence of the financial stocks is conserved across time for the investigated trading period. Our findings shed a new light on the underlying mechanisms and driving forces controlling the correlation profile observed in a financial market

Global and Local Features of Semantic Networks: Evidence from the Hebrew Mental Lexicon

BACKGROUND: Semantic memory has generated much research. As such, the majority of investigations have focused on the English language, and much less on other languages, such as Hebrew. Furthermore, little research has been done on search processes within the semantic network, even though they are abundant within cognitive semantic phenomena. METHODOLOGY/PRINCIPAL FINDINGS: We examine a unique dataset of free association norms to a set of target words and make use of correlation and network theory methodologies to investigate the global and local features of the Hebrew lexicon. The global features of the lexicon are investigated through the use of association correlations--correlations between target words, based on their association responses similarity; the local features of the lexicon are investigated through the use of association dependencies--the influence words have in the network on other words. CONCLUSIONS/SIGNIFICANCE: Our investigation uncovered Small-World Network features of the Hebrew lexicon, specifically a high clustering coefficient and a scale-free distribution, and provides means to examine how words group together into semantically related 'free categories'. Our novel approach enables us to identify how words facilitate or inhibit the spread of activation within the network, and how these words influence each other. We discuss how these properties relate to classical research on spreading activation and suggest that these properties influence cognitive semantic search processes. A semantic search task, the Remote Association Test is discussed in light of our findings

Inference of financial networks using the normalised mutual information rate

In this paper we study data from financial markets using an information theory tool that we call the normalised Mutual Information Rate and show how to use it to infer the underlying network structure of interrelations in foreign currency exchange rates and stock indices of 14 countries world-wide and the European Union. We first present the mathematical method and discuss about its computational aspects, and then apply it to artificial data from chaotic dynamics and to correlated random variates. Next, we apply the method to infer the network structure of the financial data. Particularly, we study and reveal the interrelations among the various foreign currency exchange rates and stock indices in two separate networks for which we also perform an analysis to identify their structural properties. Our results show that both are small-world networks sharing similar properties but also having distinct differences in terms of assortativity. Finally, the consistent relationships depicted among the 15 economies are further supported by a discussion from the economics view point

Network Theory Analysis of Antibody-Antigen Reactivity Data: The Immune Trees at Birth and Adulthood

Motivation: New antigen microarray technology enables parallel recording of antibody reactivities with hundreds of antigens. Such data affords system level analysis of the immune system’s organization using methods and approaches from network theory. Here we measured the reactivity of 290 antigens (for both the IgG and IgM isotypes) of 10 healthy mothers and their term newborns. We constructed antigen correlation networks (or immune networks) whose nodes are the antigens and the edges are the antigen-antigen reactivity correlations, and we also computed their corresponding minimum spanning trees (MST) – maximal information reduced sub-graphs. We quantify the network organization (topology) in terms of the network theory divergence rate measure and rank the antigen importance in the full antigen correlation networks by the eigen-value centrality measure. This analysis makes possible the characterization and comparison of the IgG and IgM immune networks at birth (newborns) and adulthood (mothers) in terms of topology and node importance. Results: Comparison of the immune network topology at birth and adulthood revealed partial conservation of the IgG immune network topology, and significant reorganization of the IgM immune networks. Inspection of the antigen importance revealed some dominant (in terms of high centrality) antigens in the IgG and IgM networks at birth, which retain their importance at adulthood