MoneyTec Traders Community Forum - View Single Post

novice · 19-01-2004, 04:39

neil4x

Fundamentals involve so many different factors and the relative importance given to each factor is hard to determine.

In Fundamental Analysis by Jack Schwager he gives a multiple regression model. The original is for the Deutch Mark. A simple version for the EUR is below.

small case regression coeficient

EUR = a + b1C + b2P + b3E + b4B + b5I

C = current account balance
P = industrial production index?
E = interest rate differential
B = 10- bond interest rate differential
I = inflation

Regression analysis is very quantative. I prefere a much more qualative method but each to their own.

From forexnews

http://forexnews.com/education/default.asp?loc=fvt

"In Forex, several studies concluded that fundamental analysis was more effective in predicting trends for the long-term (longer than one year), while technical analysis was more appropriate for shorter time horizons (0-90 days). Combining both approaches was suggested to be best suited for periods between 3 months and one year." No references to the studies that I could find.

Is this something like what you are looking for?

19-01-2004, 04:39	#12
novice Super Moderator Join Date: Oct 2003 Posts: 1,222 Downloads: 0 Uploads: 0 Rep Power: 0	neil4x Fundamentals involve so many different factors and the relative importance given to each factor is hard to determine. In Fundamental Analysis by Jack Schwager he gives a multiple regression model. The original is for the Deutch Mark. A simple version for the EUR is below. small case regression coeficient EUR = a + b1C + b2P + b3E + b4B + b5I C = current account balance P = industrial production index? E = interest rate differential B = 10- bond interest rate differential I = inflation Regression analysis is very quantative. I prefere a much more qualative method but each to their own. From forexnews http://forexnews.com/education/default.asp?loc=fvt "In Forex, several studies concluded that fundamental analysis was more effective in predicting trends for the long-term (longer than one year), while technical analysis was more appropriate for shorter time horizons (0-90 days). Combining both approaches was suggested to be best suited for periods between 3 months and one year." No references to the studies that I could find. Is this something like what you are looking for? Last edited by novice : 19-01-2004 at 05:13.