The universe is full of information and entropy is come along with the manifestation and interpretation of it. Therefore, the universe consists of events and outcomes, some of these are purely random, and some can be predicted with relative ease. In finance, we usually construct a financial model for a business or identify a trend in stock market, that way we are trying to predict the world around us and create order. An understanding of information science helps us reduce uncertainty in the decisions we make. Vlatko Vedral, professor of quantum information science at Oxford University joins The Big Trade series for a fascinating discussion on the integration of quantum physics and finance.
Professor Vedral begins with an overview on information and information theory. They quickly progress into a dialogue on the application of information theory to the world of financial markets. Peter and Professor Vedral mention several prominent models used within finance and relate them to problems often associated with models in science. They discuss the quantification of information and its potential use in finance.
Essentials from this episode:
- The definitions of information and information theory
- Parallels between financial markets and quantum physics
- Prominent models used within finance that are related to models in science
- The quantification of information and its potential use in finance
- Applications of blackjack strategies in finance
- An understanding of time within quantum physics
- Market efficiency
- Theories of the universe
- Quantum game theory
For these essentials and more, listen to the podcast here:
