Developing a Composite Measure to Represent Information Flows in Networks: Evidence from a Stock Market

This paper employs a design science approach and proposes a new composite metric, eigen attention centrality (EAC), as a proxy for information flows associated with a node that considers both attention to a node and coattention with other nodes in a network. We apply the EAC metric in the context of a financial market where nodes are individual stocks and edges are based on coattention relationships among stocks. Composite information from different channels is used to measure attention and coattention. We evaluate the effectiveness of the EAC metric on predicting abnormal returns of stocks by (1) using multiple prediction methods and (2) comparing EAC with a set of alternative network metrics. Our analysis shows that EAC significantly outperforms alternative models in predicting the direction and magnitude of abnormal returns of stocks. Using the EAC metric, we derive a stock portfolio and develop a trading strategy that provides significant and positive excess returns. Lastly, we find that composite information has significantly better predictive performance than separate information sources, and such superior performance owes to information from social media instead of traditional media.

On the Motion of Substance in a Channel of a Network: Extended Model and New Classes of Probability Distributions

We discuss the motion of substance in a channel containing nodes of a network. Each node of the channel can exchange substance with: (i) neighboring nodes of the channel, (ii) network nodes which do not belong to the channel, and (iii) environment of the network. The new point in this study is that we assume possibility for exchange of substance among flows of substance between nodes of the channel and: (i) nodes that belong to the network but do not belong to the channel and (ii) environment of the network. This leads to an extension of the model of motion of substance and the extended model contains previous models as particular cases. We use a discrete-time model of motion of substance and consider a stationary regime of motion of substance in a channel containing a finite number of nodes. As results of the study, we obtain a class of probability distributions connected to the amount of substance in nodes of the channel. We prove that the obtained class of distributions contains all truncated discrete probability distributions of discrete random variable ω which can take values 0,1,⋯,N. Theory for the case of a channel containing infinite number of nodes is presented in Appendix A. The continuous version of the discussed discrete probability distributions is described in Appendix B. The discussed extended model and obtained results can be used for the study of phenomena that can be modeled by flows in networks: motion of resources, traffic flows, motion of migrants, etc.

Oppilatio+ - A data and cognitive science based approach to analyze pedestrian flows in networks

Public transport services are a widespread and environmentally friendly option for mobility. In the majority of cases, passengers of public transport services will have to walk from a subway, train, or bus station to their desired travel destination. In an urban environment with a network of narrow streets, this can lead to crowd congestions during rush hour, due to the fact that passengers tend to arrive in waves. In order to monitor and analyze such crowding behavior, city planners, crowd managers, and organizers of public events must ascertain which routes these pedestrians will take from the respective station to their destination. The Oppilatio+ approach is suitable for solving this problem. It is an easy-to-apply approach to predict way-finding behavior with a minimal set of information. The necessary data includes the schedule of incoming transport vehicles at the stations and the time-stamped count of pedestrians at the respective destinations. Under these conditions, the Oppilatio+ approach is suitable for estimating the distribution of pedestrians on all possible walkways between stations and destinations. This information helps crowd control experts to recognize weak spots in the infrastructure and help event organizers to ensure an undisturbed arrival at their event. We validated our approach using two field experiments. The first one was a field study on a public event, and the second one was a case study for a large Swiss train station.