A Qualitative and Quantitative Look at GE (as of 1-16-2008)

Below is the CPMAR (current price to moving average ratio) for GE. A

CPMAR value of less than 1 indicates that the current price is less

than the (ten day) moving average. If the CPMAR = 1 then the moving

average and the current price are equal. Finally, if the CPMAR is

greater than 1 then the current price is greater than the moving

average.

Fig.1

All averages are tracked on a 10 Day Moving Average Basis.

ARPC = Average Relative Price Change

ARPA = Average Relative Price Acceleration

Fig.2

For an explanation of Relative Price Change and Relative Price

Acceleration go to

http://www.intelrap.com/mathfinance1.html

Later we will discuss how these graphical (and quantitative) tools can help

us to make qualitative estimates of the tendency of a stock price (GE in

this case) to “revert to the mean”. Still later we will present quantitative

forecast models.