Driven IFS and Data Analysis

Driven IFS and the Taiwanese and Chinese Stock Markets

Here are driven IFS plots using data (left) before May 22, 2000, the inauguration of Taiwan's new president, and (right) after May 22, 2000.
In the longer record, Wu observed the subsquare with address 323 is empty. This is plausible, because this address signals a rise, fall, and rise of the TAIEX, and corresponding fall, rise, and fall of the SSE.
After the inauguration of the new president, Wu observed
(1) most points land in squares with address 2 and 4, signaling declines in the TAIEX,
(2) the small population of points in addresses 33 and 44 indicate few consecutive falls in the SSE, and
(3) the larger number of points in square 22 shows there were many consecutive falls in the TAIEX, simultaneous with rises in the SSE.
Although we must be careful with deductions made on such small data sets, the general observation matches known trends: China's market continued to grow, while Taiwan's lost over half its value in this time period.
Of course, we don't need driven IFS to notice this. However, driven IFS are good at detecting fairly long and convoluted correlations in the data.

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