This is slightly beyond my comprehension. I know about time series and probability distributions. What's serial dependency in a t.s.?
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Do you see patterns in Random Walks?
- Thread starter atlTrader666
- Start date
This is slightly beyond my comprehension. I know about time series and probability distributions. What's serial dependency in a t.s.?
Here's an <a href="http://www.smbtraining.com/blog/another-look-at-randomness">interesting look at identifying randomness</a> I read a while back. I encourage you folks to give it a shot yourselves.
<font size=1>NOTE: I am not affiliated with SMB in any way. Nor do I want to be (no longer interested in stocks or prop trading).
<font size=1>NOTE: I am not affiliated with SMB in any way. Nor do I want to be (no longer interested in stocks or prop trading).
Quote from Samsara:
Here's an <a href="http://www.smbtraining.com/blog/another-look-at-randomness">interesting look at identifying randomness</a> I read a while back. I encourage you folks to give it a shot yourselves.
Great find... I guessed A, E, F, G, I were fake. J came close... I couldn't find the next blog with the answers lol.
I wonder how many I got right. Perhaps we can identify candlestick charts that are real, but do we have enough information to profit from it? I still claim that patterns are insufficient in making trading decisions. I do not claim that price action is insufficient in helping to make money...
Is it possible that big players manipulate chart appearances for their own benefit... aka use their capital to paint a bull flag (wash sales to attract volume)... have a bunch of day traders buy for a breakout trade and then get all those traders hooked on the wrong side? Perhaps the market is too efficient and liquid for these games but I wouldn't be surprised if it happened on small caps.
A truly profound statement. Expect 95% of ET to take issue with this statement but you're spot on. Although, even a true quant needs to have that artistic, touchy, feely, not necessarily visual, quality to successfully navigate the markets. Brut science will eventually fail.
All things being equal, if an MS or PhD quant resume and a CMT resume hits a bank's trading desk guess which one will get the call?
All things being equal, if an MS or PhD quant resume and a CMT resume hits a bank's trading desk guess which one will get the call?
Quote from marketsurfer:
Charts/visual TA are appealing to artistic, visual, touchy feely subjective types.
Whereas true quant tactics appeal to the scientific objective math types.
Wonder why the public use charts and TA almost exclusively?
There's your answer.
MS/PhD, what's a CMT?
Quote from the1:
A truly profound statement. Expect 95% of ET to take issue with this statement but you're spot on. Although, even a true quant needs to have that artistic, touchy, feely, not necessarily visual, quality to successfully navigate the markets. Brut science will eventually fail.
All things being equal, if an MS or PhD quant resume and a CMT resume hits a bank's trading desk guess which one will get the call?
Quote from Qbit:
MS/PhD, what's a CMT?
Chartered Market Technician.
http://www.mta.org/eweb/dynamicpage.aspx?webcode=chartered-market-technician
Quote from the1:
A truly profound statement. Expect 95% of ET to take issue with this statement but you're spot on. Although, even a true quant needs to have that artistic, touchy, feely, not necessarily visual, quality to successfully navigate the markets. Brut science will eventually fail.
All things being equal, if an MS or PhD quant resume and a CMT resume hits a bank's trading desk guess which one will get the call?
Thank you. I would go so far as to define the difference as the old left brain , right brain paradigm. Banks don't actually hire CMT's at all --- if they do it's likely for the marketing department to draw pictures for the sales brochures.
I was a member of the MTA when I was a TA. Good group of guys but way too cult like for my tastes. Surf
Quote from marketsurfer:
Thank you. I would go so far as to define the difference as the old left brain , right brain paradigm.
That's nonsense! The ideal approach is to draw the strengths from each hemisphere. It's not like scientists are not creative, they have to be.
Intuitiveness has been at the core of our scientific advancements!
Haven't read all the posts but just to make things clear, the fact that there's a brownian component to the stock diffusion equation doesn't mean much, there's also a deterministic component and that's what people look at when they build indicators & signals.
Sometimes it can be hard to distringuish if a pattern existed because of one or the other component and so if it is a reall pattern or a ghost but lets not overstate the role of the brownian component.
Sometimes it can be hard to distringuish if a pattern existed because of one or the other component and so if it is a reall pattern or a ghost but lets not overstate the role of the brownian component.
Quote from etile:
I don't understand the random walk thesis. If you expand your time horizons far enough (to years) you can see definitive trends. From a long term perspective prices will follow fundamentals of a stock. Sure the premium multiple will probably change over time, but a good stock or bad stock will show its innards eventually and this will be reflective of its price that is often arrived at in a trend.
I'm not a random walk expert, or even that smart, but it seems that the random walk theory presuppose that all market participants act randomly. Yet if you think about, every trader is trying to think about what the masses as a whole will do. The confluence of the same sentiment occurring over a prolonged period of time does not happen by happenstance.
Maybe its just me.
No, the random walk theory does not presuppose that all market participants act randomly. To the contrary, the random walk theory assumes that market participants act rationally, have good information, and that that information is quickly incorporated into prices. As a result, the only reason prices change is because of unforeseeable events that couldn't already have been priced in the stock. Because the unforeseeable events are considered to be random, so are the price changes.