An Optimal Selling Strategy for Stock Trading Based on Predicting the Maximum Price
نویسنده
چکیده
An optimal selling strategy for stock trading is presented in this paper. An investor with a long position in one stock decides to close the position before a given time. The investor continuously observes the stock price performance and has to determine the point in time to close out the position (selling strategy) so that the stock price is as close as possible to the maximum price. The probable proximity is measured by a probability distance and the problem can be formulated mathematically as an optimal prediction problem.
منابع مشابه
Predicting stock prices on the Tehran Stock Exchange by a new hybridization of Fuzzy Inference System and Fuzzy Imperialist Competitive Algorithm
Investing on the stock exchange, as one of the financial resources, has always been a favorite among many investors. Today, one of the areas, where the prediction is its particular importance issue, is financial area, especially stock exchanges. The main objective of the markets is the future trend prices prediction in order to adopt a suitable strategy for buying or selling. In general, an inv...
متن کاملOptimal Stock Selling/Buying Strategy with reference to the Ultimate Average∗
We are concerned with the optimal decision to sell or buy a stock in a given period with reference to the ultimate average of the stock price. More precisely, we aim to determine an optimal selling (buying) time to maximize (minimize) the expectation of the ratio of the selling (buying) price to the ultimate average price over the period. This is an optimal stopping time problem which can be fo...
متن کاملTrading the Twitter Sentiment with Reinforcement Learning
This paper is to explore the possibility to use alternative data and artificial intelligence techniques to trade stocks. The efficacy of the daily Twitter sentiment on predicting the stock return is examined using machine learning methods. Reinforcement learning(Q-learning) is applied to generate the optimal trading policy based on the sentiment signal. The predicting power of the sentiment sig...
متن کاملاندازه گیری سطح عدم تقارن اطلاعات برای شرکت های منتخب فعال در بورس اوراق بهادار تهران: احتمال مبادله آگاهانه(PIN)
The level of asymmetric information in financial markets is important for its impact on the market formation, price levels and its interaction with investment risk. Also, determining the optimal rules by policy makers and determining the trading strategy by investors is done according to the level of information symmetry in the market. In financial literature, many metrics have been developed t...
متن کاملProfitability of Iranian Stock Market Based on Technical Analysis Trading Rules
In this study, we focused on Tehran stock exchange market analysis based on applying moving average rules. The Tehran stock exchange in the Middle East has evolved into an exciting and growing marketplace where individual and institutional investor trade securities of over 420 companies. In an attempt to examine the ability to earn excess return by exploiting moving average rules, the average a...
متن کامل