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Wednesday
Dec142011

He Who Knows the Potential Wins

DateWednesday, December 14, 2011 at 10:10AM | by AuthorMichael Bigger | CommentPost a Comment

You can define potential energy as the energy required to move an object from height a to height b.

The potential energy in a value investment relates to the difference between a stock's intrinsic value and its current price.

In a pair trade, the z-score relates to its potential energy.

and so forth...

Knowing both numbers helps you win. Makes sense?

Written by Michael Bigger. Follow me on Twitter and StockTwits.


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