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DYNAMICS AND STRUCTURE OF THE MAIN ITALIAN COMPANIES

JUAN GABRIEL BRIDA

School of Economics and Management, Free University of Bolzano, Bolzano, 39100, Italy

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and

WISTON ADRIAN RISSO

Department of Economics, University of Siena, Siena, Italy

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https://doi.org/10.1142/S0129183107011741Cited by:23 (Source: Crossref)

Abstract

Financial markets can be modeled as complex systems. The Hugh quantity and different information affecting these markets is a remarked characteristic. However some of this information can be recovered by constructing a topology of the market. We develop a symbolic method in order to study relationships in the financial markets by constructing a minimal spanning tree (MST) and a hierarchical tree (HT). The method is successfully applied to the Italian financial market, detecting clusters with economic sense. This classification is helpful in portfolio construction and studying industrial networks.

Keywords:

PACS: 11.25.Hf, 123.1K

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