The Volume Accumulation Oscillator (VAO) is more sensitive to volume versus price than the On Balance Volume indicator. The formula for Volume Accumulation is: VAC = Volume * ( Close - High + Low / 2 ) A rising price trend will be confirmed by a rising VA line. An uptrend paired with a rising Volume Accumulation line is considered bullish while a Volume Accumulation … [Read more...]
On Balance Volume (OBV) : An Overview
Joe Granville introduced the On Balance Volume (OBV) indicator in his 1963 book, Granville's New Key to Stock Market Profits.A method used in technical analysis to detect momentum, the calculation of which relates volume to price change. OBV provides a running total of volume and shows whether this volume is flowing in or out of a given security.OBV attempts to detect when a … [Read more...]
Cumulative Volume Index
The Cumulative Volume Index function determines the momentum of the market by calculating the cumulative difference between the volumes of the advancing and declining issues. he Cumulative Volume Index resembles On Balance Volume, or OBV, in some respects. Both indexes were developed to demonstrate if volume is flowing into or out of the market.The CVI takes into consideration … [Read more...]
Equity Risk Premium : The Overview
A risk premium is the minimum difference a person requires to be willing to take an uncertain bet, between the expected value of the bet and the certain value that he is indifferent to.The equity risk premium is commonly viwed as the extra retun needed to induce investors to risk their money in the stock market rather than opting for the safe haven of government bonds.It is a … [Read more...]
Efficient Market Hypothesis: Introduction
EMH i.e Efficient Market Hypothesis is an investment theory that states that it is impossible to "beat the market" because stock market efficiency causes existing share prices to always incorporate and reflect all relevant information. According to the EMH, stocks always trade at their fair value on stock exchanges, making it impossible for investors to either purchase … [Read more...]