Jules Augustin Frédéric Regnault (1 February 1834 in Béthencourt – 9 December 1894 in Paris) was a French economist who first suggested a modern theory of stock price changes in Calcul des Chances et Philosophie de la Bourse (1863) and used a random walk model. He is also one of the first authors who tried to create a "stock exchange science" based on statistical and probabilistic analysis. His hypotheses were used by Louis Bachelier.
During the first years of his life, Jules Regnault lived in the département du Nord (France) where his father worked. When his father died on January 16, 1846, in Paris, his family moved to Brussels, where Odilon, Jules’ brother, became a writer and a student at the Université Libre de Bruxelles in advanced mathematics. Jules’ family was not rich, and consequently, Odilon was except from serving in the military service and from paying his University registration. At the beginning of the 1860s, the two brothers moved to Paris and became brokers. In all probability, when Jules and Odilon arrived in Paris, their financial resources were low because they lived in one (or two) garret room(s), for which no tax had to be paid. However, Jules Regnault became a millionaire.
In 1881, he stopped being a broker and became a rentier. These 13 years correspond to a very easy financial period for him. He died on December 9, 1894. When he died, his fortune was estimated at 1,026,510.03 francs (that is more than 3.8 million euros 2004). The inventory of Regnault’s goods shows that the most important part of his fortune was invested in bonds (around 706,500 francs, that is around 70% of his fortune), in particular in the French 3.5% rente (166,216.80 francs), and in shares (around 104,565 francs, that is about 10%). This inventory suggests that he applied financial theory to establish a fortune. According to the Calcul des chances et philosophie de la bourse, the only valid investment for Jules Regnault must be bonds, which is precisely what his inventory shows.
There is a mistake in the Grand dictionnaire universel du XIXe siècle published by Pierre Larousse. In the Jules Regnault bibliographical note, he wrote “Regnault (Jules), French learned, dead in 1866”. This note attributes several books to Jules. However, with the exception of the Calcul des chances et philosophie de la bourse, all the other books were written by Jean-Joseph Regnault (1797-1863) who signed some of his books “J. Regnault”. This signature can explain the mistake. However, these two authors have no family relationship. The Catalogue général de la librairie française published in 1871 made the same mistake.
Read the book online http://www.archive.org/details/calculdeschances00regn
A key conclusion appears on Page 50: "l'écart des cours est en raison directe de la racine carrée des temps", in English: the deviation of prices is directly proportional to the square root of time".
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- See Gallica tome 13 page 862
- Jules Regnault 1863 Calcul des chances et philosophie de la bourse, Paris : Mallet-Bachelier and Castel.
- Franck Jovanovic 2004 "Éléments biographiques inédits sur Jules Regnault (1834-1894), inventeur du modèle de marché aléatoire pour représenter les variations boursières", Revue d'Histoire des Sciences Humaines 11: 215-230.
- Franck Jovanovic 2006 "Jules Regnault and the origins of scientific financial economics" in Pioneers of financial economics (vol. 1) edited by Geoffrey Poitras: Edward Elgar.
- Philippe Le Gall 2007 A History of Econometrics in France: Routledge
- Franck Jovanovic and Philippe Le Gall 2001 "Does God practice a random walk ? The " financial physics " of a 19th century forerunner, Jules Regnault", European Journal for the History of Economic Thought 8.3: 323-362.
- Murad Taqqu 2001 "Bachelier and his Times: A Conversation with Bernard Bru", Finance and Stochastics 5: 3-32.
- Regnault’s birth certificate can be found at the Archives départementales du Nord.
- Jules Regnault’s death certificate comes from the Archives de la ville de Paris.
- His burial vault is number 2 in div. 25, i.1/26, (on the left side of Molière’s and de La Fontaine’s graves).
- The Centre des archives contemporaines holds Jules’ testament and the inventory of his wealth after death (call numbers: 19860 351 art. 156 and 19860 351 art. 157). There is a copy of it in the donations file in the Archives départementales de l’Oise.