Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Chuzzlewit who wrote (82216)	11/24/1998 9:29:00 PM
From: BGR	Read Replies (1) \| Respond to of 176387

OT CTC, This is how I remember it: Assuming a risk-neutral world where stock prices (S) follow geometric Brownian motion (dS = rSdt + vSdz) the compounded rate of return (R) over the next period of size T is normally distributed with mean (r-ss/2) and standard deviation (s/T), where r is the risk free rate and v is the volatility of the stock. Hence as T increases E(R) tends towards (r-ss/2) (note that this is less than r because of compounding) which is usually > 0. IOW, the confidence intervals for R shift upwards as T increases. I will double check Hull once I get some time. -Apratim.