Project IdeasDate: 06/30/2002 at 15:34:53 From: Javier Vacio Subject: My 9th grade science project Hi, I am in 9th grade and need a science project. Do you have any ideas for one in math? I go to a tough advanced school so please suggest some good ones. Thank you Date: 07/01/2002 at 18:29:43 From: Doctor Ian Subject: Re: My 9th grade science project Hi Javier, The best project will be one that you're actually _interested_ in. What are the three coolest things you've learned in your science classes so far? - Doctor Ian, The Math Forum http://mathforum.org/dr.math/ Date: 07/03/2002 at 19:52:12 From: Javier Vacio Subject: My 9th Grade Science Project Hi, I would like to to my science project on math that deals with the stock market. And if you have any other great ideas besides the stock market please, feel free to send me them. Thank you. Date: 07/04/2002 at 07:01:12 From: Doctor Ian Subject: Re: My 9th Grade Science Project Hi Javier, One of the things that's supposed to make the stock market work is that it's supposed to be very efficient at distributing information. I think it would be interesting to do an analysis of the behavior of stocks just before and after news becomes public. For example, if a company misses its projected revenues, that's bad news about the company, and you'd expect the company's stock to decline in value _after_ the announcement. This raises a question: How _long_ after? How much time does it take for that information to reach the people who use it as a basis for their actions? A second, perhaps more interesting question, would be this: Are there situations where the stock starts dropping _before_ the news is released? That would happen if large numbers of investors were dumping the stock _before_ 'hearing' the bad news... which would indicate that perhaps some insider-trading is going on. From the perspective of the SEC, it would be interesting to be able to detect after the fact when this seemed to be happening. From the perspective of the news media, it would be interesting to be able to predict when bad (or good) news was about to be announced regarding a particular company! This would only be possible if there is some describable pattern in the effect of insider trading on stock prices. In a sense, it's the same kind of thing that seismologists are trying to do with earthquake prediction. They know how to tell after the fact that an earthquake occurred, even if it was out in the boondocks where it didn't affect anyone. The trick is to try to detect the early signs, in order to _predict_ the earthquakes... Here's another thing I've been wondering about. My brother's wife works for Reuters, and she mentioned yesterday that Reuters had a correspondent in Kuwait for years before Iraq invaded it; so when it happened, they were able to tell investors who subscribed to their news services about it something like 40 minutes before the rest of the world found out about it on CNN. Supposedly, those 40 minutes were worth billions of dollars to investors who were able to dump stock in oil companies doing business in Kuwait. It would be interesting to identify some similar events, and try to come up with an equation that tells you just how valuable it is to have information for N minutes before everyone else... in other words, everyone says that time is money. Why not try to find out just how much money a given amount of time is worth? Here's one more thing: People are always looking for good random-number generators. Most involve some kind of algorithm, which spits out a bunch of numbers before (eventually) repeating. Mathematicians have made up all kinds of tests for randomness, which are used to compare the 'randomness' of these generators. Are there aspects of market behavior that are truly random (or more random than the generators now in common use)? If so, then they could be used as a new source of random numbers. Also, to the extent that some of these tests involve calculations involving pi and e, you could go in the other direction, and show how you could use the behavior of the stock market to determine 'experimental' values for pi and e. Do any of those sound interesting? - Doctor Ian, The Math Forum http://mathforum.org/dr.math/ Date: 07/11/2002 at 19:43:45 From: Javier Vacio Subject: Thank you (My 9th grade science project) Thank you so much for the help! I really appreciate it! All of the projects sound so interesting and advanced. |
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