Financial systems: a few theoretical and algebraic considerations for their modeling

In this paper I suggest that observable entities, usually named ‘financial systems’, may be related to the general conceptual framework of systems theory. Starting from the requisite properties of a (general) system, I derive a strong and operational concept for specific financial systems (Section 1). Then a general modeling procedure is proposed, mainly based upon graph theory (with an additional and complementary use of linear systems analysis), through which it is possible to establish the general static and almost dynamic properties of these specific systems and their implications for financial analysis itself (Section 2). A numerical example (Section 3) illustrates most of the concepts and ideas introduced throughout the paper.