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Technology Stocks : Dell Technologies Inc.

DELL 143.47

+3.4%

12:43 PM EST

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To: Moominoid who wrote (83408)	12/7/1998 9:26:00 PM
From: BGR	Read Replies (2) of 176387

David, I agree that it is not - as you say - perfect white noise. That would be true in a completely efficient market where information is available to all and analyzed rationally by all so that prices adjust instantaneously to levels where every trade is a pure noise trade. Since we do not have conclusive evidence for the strong form of EMH, this is unlikely. My personal feeling is that if Fama was smart enough to figure out EMH, it is not that unlikely that some investors are smart enough - and not just lucky - to be rich. But the evidence for deviation is miniscule with few Warren buffets (and long-term DELL holders) in the field. As for your model, it seems that you are interpreting BBs as some sort of a confidence interval for equity price (please correct me if I am wrong). Now confidence intervals expand in proportion to square root of time elapsed for a variable following geometric brownian motion. Therefore I am not sure why you think that P-M will be a mean-reverting process. Unless you diasgree with the brownian part of the motion, that is. -Apratim.

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