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> The key is that one must learn to understand when the market is brownian
> moving and when its not. ie panic.. When its moving in its
> statistically correct manner then it adheres to the laws of the normal
> distribution..
Well said.
> One of the interesting questions to ask your self is will you make more
> money over time playing
> 2 standard deviation moves or one standard deviation moves?
Re the 1 or 2 sigma moves: The meat and potatoes comes to me from the 1
sigma moves consistently captured. Statistically valid per trading results.
2+ sigma moves are the gravy.
The trouble with investing is that one is never sure of the sequence of
changes that the future holds given that the recent past has done x or y
sigma moves.
The trouble with investing is also that one can not bet the ranch on one fat
tail event to trigger within the instrument's lifespan if one trades
time-depreciating assets like we do.
The trouble, in sum, is reconciling fear with greed.
What was it about the tortoise? Slow and steady... gets high frequency
Jupiter transits through one's 2nd house :)
Gitanshu
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