InvestorsHub Logo
Followers 12
Posts 305
Boards Moderated 0
Alias Born 11/04/2013

Re: Ragin_Cajun post# 39572

Friday, 08/07/2015 7:19:46 AM

Friday, August 07, 2015 7:19:46 AM

Post# of 57542
In standard quantitative analysis, equities are expected to move as geometric Brownian motions with a particular drift and volatility. These parameters allow us to calculate the probability that a particular sized move up (or down) is to occur. While OTC markets are challenged by liquidity issues and over sensitivity to order flow (typically a byproduct of liquidity) we can still apply this model to some extent. Basically, if we begin to see 2.5-3+ standard deviation moves in a few days we know that there has been a material change in the fundamentals and market sentiment behind edxc.