Brownian motion linear and angular momenta remain null over time. It is important also to note that the kinetic energies of the molecular Brownian motions, together with those of molecular rotations and vibrations sum up to the caloric component of a fluid's internal energy. This motion is named after the botanist Robert Brown, who was the most eminent microscopist of his time. In 1827, while looking through a microscope at pollen of the plant "Clarkia pulchella" immersed in water, the triangular shaped pollen burst at the corners, emitting particles which he noted jiggled around in the water in random fashion. He was
Geometric Brownian motion above: formula_27. import numpy as np import pandas as pd import matplotlib.pyplot as plt mu=1 n=50 dt=0.1 x0=100 x=pd.DataFrame() np.random.seed(1) for sigma in np.arange(0.8,2,0.2): x.columns=np.arange(0.8,2,0.2) plt.plot(x) plt.legend(x.columns) plt.xlabel('t') plt.ylabel('X') plt.title('Realizations of Geometric Brownian Motion with different variances\n mu=1') plt.show() GBM can be extended to the case where there are multiple correlated price paths. Each price path follows the underlying process where the Wiener processes are correlated such that formula_31 where formula_32. For the multivariate case, this implies that Geometric Brownian motion is used to model stock prices in the Black–Scholes model and is the most widely used model of stock