New study reveals all market equilibria belong to one-dimensional curve
The article explores how prices are determined in a market with two types of assets. By studying how traders make investment decisions based on past data, the researchers found that all possible market equilibria can be represented on a single curve. This curve helps us understand different market outcomes, like having multiple equilibria, and can be used to compare different strategies. The stability of these equilibria also influences how the market evolves over time.