Stock Correlations as Market Predictors: 66 Tests and Chaos Theory

Repositorybhoult/correlationResearch

This repository investigates whether time-offset correlations between stocks can forecast market movements. Based on 66 pre-registered tests and a high-performance Rust pipeline, it demonstrates why market dynamics resemble a triple pendulum and remain fundamentally unpredictable.

Key points

  1. Tests whether delayed market ripples across linked companies allow predictable price forecasts.
  2. Required roughly 1.5 trillion calculations, scaling from Ruby and inline C to a Rust implementation leveraging CPU, GPU, and NPU.
  3. Presents 66 pre-registered tests and uses a triple pendulum analogy to explain chaotic failure points.
  4. Developed with assistance from Claude 4.0 and Claude 5.5, inviting community hypotheses via pull requests.

Why it matters

It clearly demonstrates the practical limits of mathematical market prediction while showcasing how modern AI tools can implement complex, compute-heavy pipelines.

Analysis

The Hypothesis and Challenge

The core hypothesis dates back over twenty years: if macroeconomic factors affect companies at different rates, lagging correlations might reveal predictable market ripples. However, evaluating the entire stock market across variable offset windows required roughly 1.5 trillion calculations, making comprehensive testing historically impractical on consumer hardware.

Technical Architecture

An initial Ruby proof-of-concept estimated 15 years of run time on a 24-core desktop, while an inline C implementation would have taken six months. Using Claude 5.5, the author rewrote the entire computation in Rust to fully utilize all CPU cores, the GPU, and the onboard NPU, drastically compressing execution time.

Maturity and Audience

The project appeals to data scientists, quantitative analysts, and software developers interested in algorithmic trading limits. Distributed under the GPL-3.0 license, it stands as an empirical research project featuring 66 pre-registered tests. The author uses three identical triple pendulums to illustrate how sensitivity to initial conditions creates chaotic divergeance, invalidating simplistic correlation models.

Found in

Summary generated by AI (Gemini 3.8 Flash, 28 October 2026). It may contain errors – the original source is authoritative.

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Locations

  • Mattersburg
    Johann Nepomuk Bergerstraße 7/2/14
    7210 Mattersburg, Austria
  • Vienna
    Ungargasse 64-66/3/404
    1030 Wien, Austria

Parts of this content were created with the assistance of AI.