Expressing phenomina via tangent or signwave

2008-10-24 03:31 PM

Saul Albom
Dallas, TX
Posts: 22

I used to make descriptions of of a time series of events with a model of a sign wave or bell curve. That is what you are trained to do in finance. How ever the older I get the more I start to see two things.

The tails and outliers on such description are fatter or they adhere to fat tail theory. The closer one gets to closer to an extreme event the probability expands exponentially.

Or scraping that, phenomena is better described by tangent equations then bell curves. Extreme events and observations occur all the time and are statisitcy improbable but they do happen all the time.

Anyone see this too?