Quantitative analysis

Quantitative analysis. does anybody understands it?

Yes I do understand the basic concept. Can't explain it though, because it would be wrong to tell you just the basic theory. There is a lot of material about it floating around though. Just google it and you will find good sources.

I also hit upon this idea a few days back. Gathered the data now I have asked some experts to work on it.

My suggestion either read enough about it or hire someone who understands it. Not child's play as I was told.

Neo

Thanks my friend.
Does it involve stochastic?

Constin

When I started to do quantitative analysis on Currency pairs I found it to be very difficult. I was using the normal process and ideas of Fixed income modelling and trying to generate Monte-carlo simulations but failed for a long time. There are various reasons for this, one is becasue they are very unstable and daily movement range of currency pair could be huge. Another is that the liquidity varies all day long. If you try you will have to consider big number of variables to get something relevant.

Then my friends suggested some ideas to base my research on directional movement of pairs and their predictibily. I can not say that it works but on a macro basis it can help you to decide a better currency pair for a trading method. For example currently I trade only USD/JPY becasue I found it is the best pair for my method and it works very well for me.

I had no formal training on this, but if you have some knowledge I would just want to warn you that its way different (and difficult for me) to analyse quantitatively in Forex than in other markets. Try some different approach than usual convergence/divergence stuff......GL

Hey Constin do post your ideas here if you are going for it.....hopefully I did not scare you off

No, you didn't scare me off. Thanks.
I found some definition of quantitative analysis:
"Quantitative analyst, in finance, someone who applies mathematics, among others stochastic calculus, to finance"
http://en.wikipedia.org/wiki/Quantitative_analysis

Constin

Since it involves stochastic, I thought of it as being as the picture:

There is a lot of stuff on internet on financial modeling. Since you are so interested in stochastic process, take a look here..

http://www.dpmms.cam.ac.uk/site2002/...nancialModels/

My friend those formulas are lack of mass and defined terms.
I will never be able to put those in practice.

Thanks though,

Constin