Application of Diffusion Models in the Analysis of Financial Markets: Evidence on Exchange Traded Funds in Europe

摘要: Exchange traded funds (ETFs) are financial innovations that may be considered as a part of the index instruments category, together with stock derivatives. The aim this paper is to explore trajectories and formulates predictions regarding spread ETFs on markets in six European countries. It demonstrates ETFs’ development regard futures options their substitutes, e.g., risk management. In paper, we use mathematical models diffusion innovation allow unveiling evolutionary patterns turnover ETFs; time span analysis 2004–2015, i.e., period dynamic changes ETF markets. Such an approach has so far rarely been applied field research. Our findings indicate strongest Italy France weaker other countries, especially Poland Hungary. results highlight significant differences among countries prove not taken place all cases; there also considerable predicted paths.