Friday, November 27, 2009

Lagrangian finance and age of wonders

I had a relatively decent physics education for a non-major, but I'm pretty sure it didn't include discussions of the Lagrangian and its use in Newtonian mechanics. So I loved this brilliant exposition of the use of the Lagrangian.

Subtracting potential from kinetic energy? It feels like a measure of how much of a budget is unspent, how much is left to drive deviations from a trajectory...

That feels like finance. There ought to be applications of the Lagrangian to the world of financial modeling.

Once upon a time, that's where the thought would have ended. An idle speculation. Today, though, the answer is a few keystrokes away:

73,800 hits. Yeah, looks like there's an application or two.

We don't truly grok the web. Not yet.

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