Are Cross-Asset Spillovers Evidence of an Anti-Equilibrium? An Analysis of the S&P500 Index and Brent Crude Oil Prices

This study draws parallels between the theory of reflexivity and classical economics and attempts to find some evidence of the phenomena using Diebold and Yilmaz's spillover methodology. The closest form of perfect competition exists in the stock market. We find support to the idea that stock prices affect the fundamental value of companies (in the energy sector at least) thanks to the non-zero spillover effect between seemingly uncorrelated markets.