Convexity, stock prices and trading

R

riskfreetrading

As a function of time, (adequately processed) stocks prices can exhibit convexity (or concavity). I have models that predict such behavior of stock prices. Questions:

1. If you possess this information ahead of time, would you be able to make money with it? If yes how?

2. Do you agree with the convexity observations?

3. Did others studied related questions.

PS: If you have only a highschool degree or lower, move on from this thread as it would likely not be useful to you. Also, if you ever wrote things such as "WTF" in your posts then move out from this thread.
 
1. Probably not.
2. No, it doesn't make any sense. Convexity in the bond world is relevant because the value of a bond is convex wrt to the choice of measure (yield). I don't see how one would use time in this context.
3. I don't know.

My Z$2c...
 
Quote from atticus:

Only with respect to changes in rates.
More...

Increase[decrease] in rates results in a higher[lower] implied forward price on shares as exhibited in the synthetic market, and by further expression in the natural market.
 
Quote from riskfreetrading:

As a function of time, (adequately processed) stocks prices can exhibit convexity (or concavity). I have models that predict such behavior of stock prices. Questions:

1. If you possess this information ahead of time, would you be able to make money with it? If yes how?

2. Do you agree with the convexity observations?

3. Did others studied related questions.

PS: If you have only a highschool degree or lower, move on from this thread as it would likely not be useful to you. Also, if you ever wrote things such as "WTF" in your posts then move out from this thread.
More...

1) Of course! But it is impossible to know it ahead of time, since it plays itself out dynamically.

2) Yes.

3) Yes.
 
Quote from riskfreetrading:

if you ever wrote things such as "WTF" in your posts then move out from this thread.
More...
WTF are you talking about????

I thought you were busy making big money with your new paradigm mentoring program? What happened to that?

Convexity with respect to what?
 
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