Calculating the Risk of Losing Your Stake
Article Abstract:
The 'risk of ruin' approach to investing in the futures market means investing a constant amount of your money in the market rather than a constant fraction of your money, the theory being that a long series of constant small bets will outperform a long series of bets in changing amounts. The risk of ruin theory is taken from gaming probabilities or the statistical chances taken when a coin is tossed or a die is thrown. The same, or very similar, statistical rules can be applied to investing in futures as are used in figuring gaming probabilities. The risk of ruin is increased as the expectation of higher returns is increased.
Publication Name: Futures: Magazine of Commodities & Options
Subject: Business, general
ISSN:
Year: 1984
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Long-Term Charts the Way Gann Would Do It
Article Abstract:
William D. Gann, an English stock and commodity trader, developed a charting system for following individual stocks and commodities on a year-to-year performance comparison. Most charting services compare performance week-to-week or month-to-month. Gann's theory is that a commodity cannot be compared to its performance the week or month prior, but must be compared to the same month a year ago. By looking at past performance it can be noted where investors felt a stock or commodity had gotten too high to too low. If Gann's charts are used along with other charts, the investor can beware of false upward or downward trends.
Publication Name: Futures: Magazine of Commodities & Options
Subject: Business, general
ISSN:
Year: 1984
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Your Computer Can Take You Beyond Charting
Article Abstract:
The computer can be of great help to those investors who use charts. By defining each variable for the computer, it can print out any number of different charts for each commodity, stock, or whatever investment vehicle is being used. A computer can actually take the investor beyond where a charting service can to refine investment timing.
Publication Name: Futures: Magazine of Commodities & Options
Subject: Business, general
ISSN:
Year: 1984
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