hello
i require assistance with this equation. it deals with the probability that *at least* k distinct runs, each of *at least* r consecutive losses, will occur in a trade sample. the equation is for normal distribution and i realise that the size of market moves are not normally distributed, however it is still interesting to have this sort of readyreckoner
Prob = (C(n - k*r, k - 1) + p*C(n - k*r, k))*p^(k - 1)*q^(k*r)
where C(a, b) = a!/(b!*(a - b)!) is a binomial coefficient, k is the number of runs, and n is the trade sample size. r is the number of loses in a row. p is winning prob. q is losing probability. To be clear, this is supposed to be the probability that *at least* k distinct runs, each of *at least* r consecutive losses, will occur.
i took a!= to be (n-k*r)!. however when entered values (1000-2*15)!=970!, the calculator returned an error message.
so, how do i calculate a,b or C(a, b) = a!/(b!*(a - b)!) ?
i require assistance with this equation. it deals with the probability that *at least* k distinct runs, each of *at least* r consecutive losses, will occur in a trade sample. the equation is for normal distribution and i realise that the size of market moves are not normally distributed, however it is still interesting to have this sort of readyreckoner
Prob = (C(n - k*r, k - 1) + p*C(n - k*r, k))*p^(k - 1)*q^(k*r)
where C(a, b) = a!/(b!*(a - b)!) is a binomial coefficient, k is the number of runs, and n is the trade sample size. r is the number of loses in a row. p is winning prob. q is losing probability. To be clear, this is supposed to be the probability that *at least* k distinct runs, each of *at least* r consecutive losses, will occur.
i took a!= to be (n-k*r)!. however when entered values (1000-2*15)!=970!, the calculator returned an error message.
so, how do i calculate a,b or C(a, b) = a!/(b!*(a - b)!) ?
another INTP