time of this writing, things are getting better. People are beginning to understand
what the hell I’m talking about, although so far the financial press and television
haven’t dared to stress the relative change as the more valid of the two figures.
To be sure, the academic community and the big boys of Wall Street have
always known about this, although the academic community many times prefers to
work with logarithmic changes instead (as for example, in the Black–Scholes
options evaluation formula), which is essentially the same thing. Why they haven’t
stressed this to the average trader and investor is beyond me. Could it be that it pro-
vided them a good opportunity to make a buck at your expense?PART 1 How to Evaluate a System 5