Saturday, December 15, 2007

Quant Tools - Used in Investments

A scientific phrase - using Quant Tools - will become a common phrase in thwarting a decline in markets - by paralleling two separate types of investments. Investors will be targeted by fund managers (who are looking for progressive fees.) - Watch out! A few managers have become successful. An example of this type of investment. Two years ago AMD was selling for $40 and INTC (intel) was selling for $18. Buying Intel and selling short AMD (at the same time) would have rewarded you a $10 profit in Intel (18 to 28) and a $30 prolfit in AMD - short (40 to 10.)
Intel and AMD are the only competitors in a certain type of chip - while one was going to recover and the other was going to decline - if they are picked and "paired" in an investment - you can make money on both! This was a classic "pairing" - Many situations can be "paired" in investments - for profit in a declining market.

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