Supercomputers can predict stock market volatility

One of the present bloggers was mentioned in a San Jose Mercury News article on the usage of supercomputers in the financial world.

The article emphasizes that the massive flow of information in financial markets is not a particularly daunting challenge for modern high-performance computer systems, which can perform quadrillions of operations per second.

Some recent research has identified some volatility measures that, in retrospect, could have waved a “yellow flag” warning alerting market regulators of an incipient “flash crash,” such as the event that occurred on 6 May 2010, when the U.S. stock market plunged 9% overall over the space of an hour (and some shares, such ad Accenture, plunged to $0.01).

Full details are available here.

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