Chaos in economy (Commodities)

Resumen

Chaos is based on nonlinear phenomena occurring everywhere, but it brings stability and its own structure. Many are the linear realities, but there are phenomena to which mathematical systems do not describe acceptably. Charting these relationships is challenging to obtain a representative model of reality. In the chaos, a small disturbance will amplify, and initially close trajectories diverge. The instability leads to new aspects. This helps in the process of modeling for the study of simulations that are applied in the financial and economic fields, showing that the market continues to disorder in an organized manner. Research in the last 25 years focus on the risk and volatility of the behavior of commodity prices. The analysis and forecast of price behavior in commodity markets are relevant both for producers, cooperatives and industries and for global financial markets. These applications aim to enable projections of future commodity prices, improving decision-making in the future. In modeling commodity time series we must take into account several factors such as seasonality in prices due to fluctuations in supply and demand during periods of crop and season. The analysis of the behavior of prices of an asset is important for predicting future revenue, past behavior analysis of a series of prices and study of the historical price of a product. That's one reason the applicability of chaos theory: the ability to identify and explain fluctuations in the markets that appear to be random, but actually are not.