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This paper introduces a comprehensive framework for Financial Information Theory by applying information-theoretic concepts such as entropy, Kullback-Leibler divergence, mutual information, normalized mutual information, and transfer…

Portfolio Management · Quantitative Finance 2025-11-21 Miquel Noguer i Alonso

Inferring nonlinear and asymmetric causal relationships between multivariate longitudinal data is a challenging task with wide-ranging application areas including clinical medicine, mathematical biology, economics and environmental…

Methodology · Statistics 2021-08-25 Tom Edinburgh , Stephen J. Eglen , Ari Ercole

Time series are all around in real-world applications. However, unexpected accidents for example broken sensors or missing of the signals will cause missing values in time series, making the data hard to be utilized. It then does harm to…

Machine Learning · Computer Science 2020-11-24 Chenguang Fang , Chen Wang

The concept of distance covariance/correlation was introduced recently to characterize dependence among vectors of random variables. We review some statistical aspects of distance covariance/correlation function and we demonstrate its…

Methodology · Statistics 2018-07-13 Dominic Edelmann , Konstantinos Fokianos , Maria Pitsillou

Permutation entropy measures the complexity of deterministic time series via a data symbolic quantization consisting of rank vectors called ordinal patterns or just permutations. The reasons for the increasing popularity of this entropy in…

Data Analysis, Statistics and Probability · Physics 2021-03-08 José M. Amigó , Roberto Dale , Piergiulio Tempesta

The estimation of the correlation between time series is often hampered by the asynchronicity of the signals. Cumulating data within a time window suppresses this source of noise but weakens the statistics. We present a method to estimate…

Data Analysis, Statistics and Probability · Physics 2009-02-18 Bence Toth , Janos Kertesz

The analysis of event time series is in general challenging. Most time series analysis tools are limited for the analysis of this kind of data. Recurrence analysis, a powerful concept from nonlinear time series analysis, provides several…

Chaotic Dynamics · Physics 2024-09-16 Norbert Marwan

In this paper we prove estimates on the behaviour of the Kolmogorov-Sinai entropy relative to a partition for randomly perturbed dynamical systems. Our estimates use the entropy for the unperturbed system and are obtained using the notion…

Dynamical Systems · Mathematics 2007-05-23 Claudio Bonanno

We adapt the Kolmogorov-Sinai entropy to the non-extensive perspective recently advocated by Tsallis. The resulting expression is an average on the invariant distribution, which should be used to detect the genuine entropic index Q. We…

Condensed Matter · Physics 2009-10-31 Jin Yang , Paolo Grigolini

The correlations that can be observed between a set of variables depend on the causal structure underpinning them. Causal structures can be modeled using directed acyclic graphs, where nodes represent variables and edges denote functional…

Quantum Physics · Physics 2015-01-08 Rafael Chaves , Christian Majenz , David Gross

We propose an extension to time series with several simultaneously measured variables of the nonlinearity test, which combines the redundancy -- linear redundancy approach with the surrogate data technique. For several variables various…

comp-gas · Physics 2009-10-28 Milan Paluš

In this review article we consider linear regression analysis from a geometric perspective, looking at standard methods and outputs in terms of the lengths of the relevant vectors and the angles between these vectors. We show that standard…

Methodology · Statistics 2021-09-20 Ben O'Neill

The traditional approach to the quantitative study of segregation is to employ indices that are selected by ``desirable properties''. Here, we detail how information theory underpins entropy-based indices and demonstrate how desirable…

Physics and Society · Physics 2022-12-15 Boris Barron , Yunus A. Kinkhabwala , Chriss Hess , Matthew Hall , Itai Cohen , Tomás A. Arias

The wide application of estimation techniques in system analysis enable us to best determine and understand the history of system states. This paper attempts to delineate the theory behind linear and non-linear estimation with a suitable…

Applications · Statistics 2014-10-21 Raja Manish

We compare the elementary theories of Shannon information and Kolmogorov complexity, the extent to which they have a common purpose, and where they are fundamentally different. We discuss and relate the basic notions of both theories:…

Information Theory · Computer Science 2020-07-21 Peter Grunwald , Paul Vitanyi

Temporal Graph Neural Networks, a new and trending area of machine learning, suffers from a lack of formal analysis. In this paper, information theory is used as the primary tool to provide a framework for the analysis of temporal GNNs. For…

Information Theory · Computer Science 2024-08-13 Amirmohammad Farzaneh

Sequentially obtained dataset usually exhibits different behavior at different data resolutions/scales. Instead of inferring from data at each scale individually, it is often more informative to interpret the data as an ensemble of time…

Mesoscale and Nanoscale Physics · Physics 2021-03-19 Yuan Yang , Jie Ding

This is a review of aspects of the theory of algorithmic information that may contribute to a framework for formulating questions related to complex highly unpredictable systems. We start by contrasting Shannon Entropy and…

Computational Engineering, Finance, and Science · Computer Science 2017-07-27 Hector Zenil

Deep learning methods achieve remarkable predictive performance in modeling complex, large-scale data. However, assessing the quality of derived models has become increasingly challenging, as more classical statistical assumptions may no…

Machine Learning · Statistics 2026-03-02 Daniele Zambon , Cesare Alippi

Information theory on a time-discrete setting in the framework of time series analysis is generalized to the time-continuous case. Considerations of the Roessler and Lorenz dynamics as well as the Ornstein-Uhlenbeck process yield for…

Chaotic Dynamics · Physics 2008-06-04 Detlef Holstein