Geometric progression and relative strength index applied to FX hedging
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This research aims at profit maximization and loss minimization in any FX
market trading. A geometric progression (geometric sequence), is said to be a non-zero
number progression or sequence in which each term following the first is obtained via
multiplying the prior by the common ratio, which is a predetermined non-zero value.
This method seeks to open an opposite position to an existing initial position in order to
hedge that initial position in the event that the market moves against our trade. There
are a number of mathematical models to develop new hedging strategies for Forex
trading. Due to the apparent high level of unpredictability in price movement,
forecasting the future of a stock price is a challenging endeavor. The research would
like to study one with geometric progression in particular. In other words, every
number can be entered as multiple integer of a different number. Thus, 1, 2, 4, 8,..., 2n
is a step forward. Smart traders never take more risks than their capital, however, the
otherwise is viewed and considered here.
Keywords
QA Mathematics