Investors use quantitative commercial strategies based on statistical information to determine the potential of specific actions. Some strategies rely on company information while others focus on price trends. Stop-losses are used to protect against losses, and some investors combine information with past experience while others rely solely on numbers. However, these strategies can react slowly to market changes, so stop-losses provide protection.
Quantitative commercial strategies are used by investors who believe in the reliability of stadistic information as the determining factor in the potential of specific actions. Some strategies are based on the real qualities of the companies that issue actions and pertain to the information obtained from financial informants. Other quantitative trading strategies are based on trends in the price movements of their own actions like a medium to predict future price movements. Instead, reversers like to protect themselves against large losses by setting up a stop-loss for any trade they make, which allows them to move up to any stock position they may be in bad weather.
The reversers hold a large cantidad of information at their alcance about all the actions available for them. Some investors like to use parts of this information and combine it with their own past experience in making buying and selling decisions. Others inverseres like to let the numbers take the decisions by them, thus eliminating any psychological obstacle. For this last group of inverters, there are numerous quantitative commercial strategies that are centered solely on the numbers.
The inverters that use quantitative commercial strategies in the menu decide whether to buy or sell an action according to the dictados of the system they follow. Some of these systems are based on the companies that issue the actions. The input information and the balances are the source of the information pertinent to these strategies. The raw numbers obtained from this information can be described in the financial indices that cover practically all aspects of the operations of an enterprise.
Conversely, some inverters opt to ignore the details of a company in favor of following price trends. These inversionists tend to be day traders and swing traders who can get into and move up from their positions in question day by day in an effort to obtain quick wages. As a result, the quantitative commercial strategies that they use will probably center on the volatility of an action, which is a medium of rapidity with which the price and range of its movement moves. The systems to select actions this way in the menu send purchase signals or sell to the reversers when the price of an action reaches a certain level.
One of the drawbacks inherent in quantitative commercial strategies is that they can react slowly before important market changes. As a result, some strategies may take various interchanges but before they may make adjustments. For this reason, reversers may want to place a stop-loss on any trade they make. Stop-loss are placed at a level where the reverser is not comfortable staying in a specific position and running the risk of losing more money. This allows for certain protection against a potentially flawed strategy.
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