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"coz securities' distro are log-normal default. I think I need to read
that book."
Yes reread the part where they are using 10 to 20 years worth of data to
get a log normal distribution. If you are a "buy and hold" investor this
is no problem. But if you trade shorter time frames, the log normal
argument does not work very well. Where is the log normal distribution of
something that has traded in a range for 60 days? The statisticians who
wrote the books on log normal distribution assumed away the
differentiating features of many investors investing over different
investment horizons.
Ron McEwan
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