QuantInsti Blog » Mathematics and Econometrics

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Learn the practical applications of mathematics and econometrics in finance. QuantInsti Blog covers time series analysis, portfolio management, probability distribution, econometrics, and many mathematical models.

QuantInsti Blog » Mathematics and Econometrics

2y ago

By Bhavika Balani
Is it possible to use Probability in Trading? How can someone do so? This comprehensive guide provides you an in depth knowledge of the concept of Probability and it's application in trading. With various examples, it discusses probability and explains why you need to have a good idea about how it works.
This article is divided into the following sections:
What is probability?
Probability formula
Application of Probability
Two properties of probability
Types of probability
Subjective probability
Objective probability
What is a probability distribution?
Discrete probabil ..read more

QuantInsti Blog » Mathematics and Econometrics

2y ago

By Vivek Krishnamoorthy
Linear regression, simple linear regression, ordinary least squares, multiple linear, OLS, multivariate, ...
You've probably come across these names when you encountered regression. If that isn't enough, you even have stranger ones like lasso, ridge, quantile, mixed linear, etc.
My series of articles is meant for those who have some exposure to regression in that you've used it or seen it used. So you probably have a fuzzy idea of what it is but not spent time looking at it intimately. There are many write-ups and material online on regression (including the QI blog) wh ..read more

QuantInsti Blog » Mathematics and Econometrics

2y ago

By Satyapriya Chaudhari
Time series modelling is a very powerful tool to forecast future values of time-based data. Time-based data is data observed at different timestamps (time intervals) and is called a time series. These time intervals can be regular or irregular. Based on the pattern, trend, etc. observed in the past data, a time series model predicts the value in the next time period.
The time series models analyses and trains the model on the past data to make future predictions. There are a number of time series models available to make these predictions. In this article you will learn ..read more

QuantInsti Blog » Mathematics and Econometrics

2y ago

By Ashutosh Dave
When analysing the performance of financial securities, we give a lot of importance to the mean and the standard deviation as measures of the average return and risk, respectively.
However, the risk-adjusted performance of financial securities also depends upon the risks which arise due to the shape of the distribution of their returns. These are the higher-moment risks such as the skewness and kurtosis risks, which need to be taken into consideration for proper evaluation.
In this blog, we discuss the concept of kurtosis and its application in understanding the risk profiles ..read more