  This paper aims at designing the different important components of a
semi-closed simulated stock market (pricing mechanism, stock allocation and
news generation). The purpose is to understand the interactions of the
different aspects within a 'semi-closed' system. The complexity and nature of
the system led to the process of modifying the pricing mechanism which is
viewed from a different angle to the classical Brownian Motion and the Random
Walk model. However, it incorporates the essence of these two fundamental
theories and then investigates the matrix of investors' behaviours in relation
to news feedbacks. This paper also explores the realm of randomly generated
news to the responses of participants to determine rational and irrational
behaviours. This is carried out through uncompressing the time within the
experiment and looking at concordant and disconcordant behaviour. The focus is
on how the modified pricing equation adapts to the conditions and uniqueness
surrounding a semi-closed stock market. Thus, this paper looks at how a simple
market system where the main determinants of share prices are news, demand and
supply along with some filtering of the external forces can affect the
behaviours of investors in terms of their portfolio composition. The return
distributions can then be stipulated as arising from rational or irrational
trajectories and subsequently be simulated and matched via the proposed
modified Brownian Motion model to empirical return distributions in specific
time periods and markets.
