# Wealth dynamics in a sentiment-driven market

## TL;DR

This paper investigates how externally driven sentiment processes influence wealth distribution and market dynamics in a simulated stock market, highlighting the impact of sentiment on trading behavior and wealth evolution.

## Contribution

It introduces a simulation framework that models sentiment-driven market dynamics and explores how sentiment parameters can be inferred from observed market data.

## Key findings

- Sentiment significantly affects wealth distribution among participants.
- Market behavior can be used to infer underlying sentiment parameters.
- Simulated wealth dynamics reflect real-world market phenomena.

## Abstract

We study dynamics of a simulated world with stock and money, driven by the externally given processes which we refer to as sentiments. The considered sentiments influence the buy/sell stock trading attitude, the perceived price uncertainty, and the trading intensity of all or a part of the market participants. We study how the wealth of market participants evolves in time in such an environment. We discuss the opposite perspective in which the parameters of the sentiment processes can be inferred a posteriori from the observed market behavior.