Trend catching
I was reading this article in statistics and empirical finance, which talks of asymmetry in time horizons of investors. These things motivate many game theoretic strategies of automated trading. If we could generate a description of how different investor classes react to information on wall street then we can think of trading strategies which, looking at this and the current state of order books, can find a strategy of optimally placing requests to catch the majority of any trend.
It is clear that trends in price start after some external impulse directly related to the company. Hence understanding what information is relevant (broadly) is not difficult. There has to be a notion of automated/human corroborated interpretation of information. Often technical information, like moving averages etc are very easily discovered. Based on the different horizons and different investor class contribution to overall market movement, one can devise games to win in this model.
It is clear that trends in price start after some external impulse directly related to the company. Hence understanding what information is relevant (broadly) is not difficult. There has to be a notion of automated/human corroborated interpretation of information. Often technical information, like moving averages etc are very easily discovered. Based on the different horizons and different investor class contribution to overall market movement, one can devise games to win in this model.
0 Comments:
Post a Comment
<< Home