Friday, December 30, 2016

OK, let's do the quark traders

Normally, tree compression would be a binary operation.

In thids model we have the pit boss runs three probability trees, they decompose liquidity event. The three 'markets' are a connect 'ring', not ring in the algebra sense, but ring in the sense the three markets share the same pit boss.  The pit boss always compressdes bets between the two trees out of balane the modt (whatever that means). So the pit boss is a three way check out counter, the store owner, the supply person, and the customer do a three way deal.
So, there.  I had to push this out on asccountof the danger someone  might see the three way as a arbitrage. Well, it is, but this model makes it visible, fair.

In fact, in general, yhe pit boss works from a tree of trees, it is just that the three way is a connected loop, it got rotational flow forcedupon it whenever the pit boss needs to make white. The white limit set by contract, and each of the three pits identified by colors, which will re-quantize..  Risk is the distance from white.

1 comment:

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