|
PureBytes Links
Trading Reference Links
|
the answer should be Trader A, who choses the low of bar 20.
unless there is some reason not to count the most recent completed trading
day as a valid counting day.
kev
----- Original Message -----
From: "Holland" <hwrichards@xxxxxxxxx>
To: <metastock@xxxxxxxxxxxxx>
Sent: Saturday, October 20, 2001 11:12 AM
Subject: Re: A tale of 3 traders...
> Shashi,
>
> Tell me if I am wrong but to me a 20 day low is the lowest price in the
> last 20 days.
>
> Holland
>
> Shashi Aggarwal wrote:
> >
> > Here is a little quiz. Its mainly for the benefit of less experienced
> > traders on this list. Since I devised this quiz myself, its not too
> > difficult ;-) By the way, this is how many people trade and make simple
> > mistakes.
> >
> > For purposes of this quiz, we will assume that the last bar (today)
> > displayed in a chart is bar 1, the one before that (yesterday's) is bar
2,
> > the one before that is bar 3, and so on.
> >
> > There are 3 traders - A, B and C. They all have day jobs and when they
come
> > back home from work, they download the latest data and then look at the
> > daily charts of their stock holdings on their computers (in Metastock!)
> > Based on this, they then go to their brokers' websites and place
appropriate
> > orders. e.g. based on the chart, they update their sell-stop price
daily.
> >
> > Lets say all 3 have a long position in a particular stock which has been
> > climbing steadily. They have only one sell condition - namely, sell when
the
> > stock makes a 20-day low. This is what they do:
> >
> > Trader A - he chooses the low price of bar 20 (latest bar is bar 1, one
> > before is bar 2...see above) and selects that as his sell-stop
> > Trader B - he chooses the low price of bar 19 for his sell-stop
> > Trader C - he chooses the low price of bar 18 for his sell-stop
> >
> > Which trader is right? Remember, the sell condition is "sell when the
stock
> > makes a 20-day low". Answer tomorrow.
> >
> > Shashi
>
|