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I present an overview of some recent advancements on the empirical analysis and theoretical modeling of the process of price formation in financial markets as the result of the arrival of orders in a limit order book exchange. After…

Trading and Market Microstructure · Quantitative Finance 2021-05-04 Fabrizio Lillo

In order-driven markets, limit-order book (LOB) resiliency is an important microscopic indicator of market quality when the order book is hit by a liquidity shock and plays an essential role in the design of optimal submission strategies of…

Trading and Market Microstructure · Quantitative Finance 2018-02-27 Hai-Chuan Xu , Wei Chen , Xiong Xiong , Wei Zhang , Wei-Xing Zhou , H Eugene Stanley

We establish a diffusion approximation for a class of multi-agent controlled queueing systems, demonstrating their convergence to a system of interacting reflected Ornstein--Uhlenbeck (OU) processes. The limiting process captures essential…

Probability · Mathematics 2026-01-12 Thoa Thieu , Roderick Melnik

While queueing network models are powerful tools for analyzing service systems, they traditionally require substantial human effort and domain expertise to construct. To make this modeling approach more scalable and accessible, we propose a…

Machine Learning · Computer Science 2025-09-09 Daksh Mittal , Shunri Zheng , Jing Dong , Hongseok Namkoong

We study the impact of finite-size effect on continuous variable source-independent quantum random number generation. The central-limit theorem and maximum likelihood estimation theorem are used to derive the formula which could output the…

Quantum Physics · Physics 2020-03-02 Junyu Zhang , Yi-Chen Zhang , Ziyong Zheng , Ziyang Chen , Bingjie Xu , Song Yu

This paper studies the effect of an overdispersed arrival process on the performance of an infinite-server system. In our setup, a random environment is modeled by drawing an arrival rate $\Lambda$ from a given distribution every $\Delta$…

Probability · Mathematics 2016-02-02 Mariska Heemskerk , Johan van Leeuwaarden , Michel Mandjes

Recent work in decentralized, schedule-driven traffic control has demonstrated the ability to significantly improve traffic flow efficiency in complex urban road networks. However, in situations where vehicle volumes increase to the point…

Artificial Intelligence · Computer Science 2019-03-12 Hsu-Chieh Hu , Stephen F. Smith

Statistical and dynamical characters of stock markets have been extensively studied, which now is providing the firm basis for econophysics and its application as ``stylized facts''. However, most of those studies are for markets under the…

Physics and Society · Physics 2024-09-04 Shota Nagumo , Takashi Shimada

Procurement in maritime logistics faces challenges due to uncertainties in demand and fluctuating market conditions. To address these complexities, we introduce a flexible discrete-event simulation framework that models the request-to-order…

Applications · Statistics 2025-05-06 Georgios Vassos , Richard Lusby , Pierre Pinson

We explore the possibility of putting constraints on quintessence models with large-scale structure observations. In particular we compute the linear and second order growth rate of the fluctuations in different flavors of quintessence…

Astrophysics · Physics 2009-11-06 K. Benabed , F. Bernardeau

We compare different approximations for the wait time in distribution networks, in which all warehouses use an (R,Q)-order policy. Reporting on the results of extensive computational experiments, we evaluate the quality of several…

Applications · Statistics 2018-01-30 Christopher Grob , Andreas Bley

This paper presents a probabilistic approach to represent and quantify model-form uncertainties in the reduced-order modeling of complex systems using operator inference techniques. Such uncertainties can arise in the selection of an…

Machine Learning · Statistics 2024-11-08 Jin Yi Yong , Rudy Geelen , Johann Guilleminot

This working paper presents a comprehensive study on the development and analysis of various electricity market models, focusing on continuous, discrete, and fractional-order approaches. The continuous model captures the ongoing…

Optimization and Control · Mathematics 2024-07-29 Ioannis Dassios

The scaling of correlations as a function of system size provides important hints to understand critical phenomena on a variety of systems. Its study in biological systems offers two challenges: usually they are not of infinite size, and in…

Disordered Systems and Neural Networks · Physics 2020-07-17 Daniel A. Martin , Tiago L. Ribeiro , Sergio A. Cannas , Tomas S. Grigera , Dietmar Plenz , Dante R. Chialvo

Fashion discounters face the problem of ordering the right amount of pieces in each size of a product. The product is ordered in pre-packs containing a certain size-mix of a product. For this so-called lot-type design problem, a stochastic…

Optimization and Control · Mathematics 2016-03-26 Miriam Kießling , Tobias Kreisel , Sascha Kurz , Jörg Rambau

Understanding the statistical properties of recurrence intervals of extreme events is crucial to risk assessment and management of complex systems. The probability distributions and correlations of recurrence intervals for many systems have…

Statistical Finance · Quantitative Finance 2012-05-10 Hao Meng , Fei Ren , Gao-Feng Gu , Xiong Xiong , Yong-Jie Zhang , Wei-Xing Zhou , Wei Zhang

In this chapter we review some recent results on the dynamics of price formation in financial markets and its relations with the efficient market hypothesis. Specifically, we present the limit order book mechanism for markets and we…

Trading and Market Microstructure · Quantitative Finance 2017-08-24 Paolo Barucca , Fabrizio Lillo

We derive a continuous time model for the joint evolution of the mid price and the bid-ask spread from a multiscale analysis of the whole limit order book (LOB) dynamics. We model the LOB as a multiclass queueing system and perform our…

Trading and Market Microstructure · Quantitative Finance 2013-10-07 Jose Blanchet , Xinyun Chen

We present a simple dynamic equilibrium model for an online exchange where both buyers and sellers arrive according to a exogenously defined stochastic process. The structure of this exchange is motivated by the limit order book mechanism…

Computer Science and Game Theory · Computer Science 2008-12-02 Garud Iyengar , Anuj Kumar

In this paper we investigate a dynamic pricing model for constant demand elasticity where customers have a probability distribution on the number of items they order. This is a generalization from standard models which restrict customers to…

Optimization and Control · Mathematics 2018-03-01 Nyles Breecher , Richard Stockbridge