Financial markets contain hidden "loops" where you can make money without actually making a trade.
April 14, 2026
Original Paper
Aharanov-Bohm Type Arbitrage and Homological Obstructions in Financial Markets
arXiv · 2604.10492
The Takeaway
Using quantum topology, researchers found arbitrage opportunities based on global market inconsistencies called "holonomy." These profits are invisible if you only look at individual stocks, but emerge when you map the entire market as a geometric system, analogous to the Aharonov-Bohm effect in physics.
From the abstract
We introduce a new notion of arbitrage based on global loop effects in filtered market systems. Given a filtration modeled as a contravariant functor $F : \mathcal{T}^{op} \to \mathrm{Prob}$, we consider the associated conditional expectation functor $\mathcal{E} \circ F$ and show that it induces a canonical multiplicative distortion $dF(i) := (\mathcal{E} \circ F)(i)(1)$, which measures the failure of constant functions to be preserved under non-measure-preserving transitions. We define the hol