tag:blogger.com,1999:blog-6134743053361487135.post8993756263969844529..comments2023-06-15T09:28:28.686-04:00Comments on Dow Theory Investment: Dow Theory Update for August 26: U.S. bonds under a secondary reaction against the primary bull marketThe Dow Theoristhttp://www.blogger.com/profile/05344444810007324303noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-6134743053361487135.post-88417581060302050812022-08-31T15:39:13.866-04:002022-08-31T15:39:13.866-04:00Thanks for following my blog. Under the “classical...Thanks for following my blog. Under the “classical” Dow Theory, the minimum volatility for a movement to be considered is 3%. If the volatility of, i.e., SIL doubles the volatility of the S&P500, then the minimum volatility I will demand for SIL will be 3% x 2 = 6%. I calculate the daily percentage change (close to close) for the S&P500 and SIL. I average it for “n” days (not carved in stone, 100 days, 1000 days). If i.e., the average daily volatility for the S&P500 amounts to 0.5%, whereas that of SIL in the same period averages 1%, then SIL volatility doubles that of the S&P500. Double volatility x 3% (minimum movement for the S&P500 to be meaningful) equals 6, which is our VAMM for SIL. Of course, daily volatilities and averages change, so VAMM changes slightly too. By the way, my website thedowtheory.com contains additional information on stocks. The Dow Theoristhttps://www.blogger.com/profile/05344444810007324303noreply@blogger.comtag:blogger.com,1999:blog-6134743053361487135.post-67440319760807863572022-08-28T01:00:10.666-04:002022-08-28T01:00:10.666-04:00Manuel,
I have been following your blog for severa...Manuel,<br />I have been following your blog for several months now and have read a large percentage of your posts from the 2012 beginning. Quite often in relation to Dow Theory for bonds and precious metals, you modify the extent requirement with a VAMM adjustment, which I assume is something akin to Coefficient of Variation (standard deviation/mean). You have calculated this measure of volatility over differing periods, but I am unable to duplicate any of your figures using Excel. Would it be possible to disclose the precise formula that is used to determine these figures? Thank you.<br /> Russell CowgillAnonymousnoreply@blogger.com