Castro: The local man charges in the commodity markets; Instagram’s new crypto competitor | Recent news

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Healy


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The commodities market is way above my level of understanding. Suffice it to say that he thinks instant trading distorts the price of commodity futures and therefore makes it difficult for commodity producers (e.g. farmers) to plan their business (i.e. which crops to plant).

“As markets have sped up trade authorizations down to milliseconds to allow more transactions, price instability has increased,” he said. In the 1980s, soybean futures prices varied only $ 1 from year to year. From 2017 to 2018, there was a change of $ 4, he said.

Mathematical principles easily explain the trend, Healy said: When the market price is set by the last price paid, faster trading results in smaller samples for pricing. The law of averages tells us that smaller samples mean more variability between samples – ergo, larger price differentials.

At least that was my take out. But then he discussed the application of Einstein’s space-time theory to establishing the “temporal order” of past transactions… and it was all over for me.

I tried contacting local quantum Jaffray Woodriff to get his advice, but apparently he has better things to do than explain math and investing to a trigonometry dud like yours. (However, Woodriff agreed to a meeting with Healy, who was the last student ever to enter UVa’s nuclear engineering graduate program.)


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