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To: mauser96 who wrote (25553)5/30/2000 11:25:00 AM
From: Thomas Mercer-Hursh  Read Replies (1) | Respond to of 54805
 
the random market theory says they should. In the case of the S&P, 3 and 4 SD are about as common as 2 SD.

Err, having done my computations from actual data, this is not at all true. Violations of 3 sigma are just as rare as one would expect them to be and the distribution of variation is very satisfactorily bell-shaped around the trendline. Mind you, use a different trendline, one might get a different result, but the fact that one can get such a result with the trendline I used seems to suggest that this variation is as appropriate a domain for statistical analysis as any.