Category Archives: Market Statistics

Significance Of French Election Rally A Mere Illusion

A lot of noise in financial media yesterday about the equity markets rally after the results of the first round of French elections. Actually, any significance assigned to this rally is due to an illusion. I do not say this, … Continue reading

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A Mean Reverting Stock Market With Increasing Risk

The daily returns of the S&P 500 exhibit mean-reverting behavior since the late 1990s but the index reached new all-time highs recently. I show in this article that this has been accomplished at increasing risk, despite beliefs that volatility is … Continue reading

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Frequencies of Events Matter But Not Always

Yesterday the S&P 500 made an intraday low a little more than 0.8% below the previous day’s close and that got some bears in social media excited. However, it is the relative frequency of these events that counts, not a … Continue reading

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AAPL: Exposing Wall Street Games

The bulk of the gains in AAPL in the last six years have been realized by holding the stock on Mondays. This is a remarkable market anomaly that should not be present in the highest capitalization stock of the U.S. … Continue reading

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Despite Bear Markets, the S&P 500 Is An Intelligent Trading Strategy

The S&P 500 is an intelligent trading strategy and a popular benchmark. I show below that the probability of obtaining the mean return of the S&P 500 by chance is extremely low.

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Rare Stock Market Divergence

I pay little attention to common divergences everyone can spot on charts. I am more interested in rare price action events. With edges evaporating at an exponential rate nowadays, anything that is unusual may offer some new idea to a … Continue reading

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Amazon.com, Inc.: A Bubble Stock?

There is a lot of talk in the last few days about the stock of Amazon.com, Inc., as it continues to break to new highs. This stock exhibits bubble dynamics.

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Back to the Future

Many have noticed a similarity in recent price action with that of early 1990s, mainly due to the low volatility. But one large cap stock is acting like this is early 1970s.

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