Abstract
This chapter presents a brief motivation for using moving averages for trend detection, how moving averages are computed, and their two key properties: the average lag (delay) time and smoothness. The most important thing to understand right from the start is that there is a direct relationship between the average lag time and smoothness of a moving average.
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References
Bodie, Z., Kane, A., & Marcus, A. J. (2007). Investments. McGraw Hill.
Hyndman, R. J., & Athanasopoulos, G. (2013). Forecasting: Principles and practice. OTexts.
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Zakamulin, V. (2017). Why Moving Averages?. In: Market Timing with Moving Averages. New Developments in Quantitative Trading and Investment. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-60970-6_1
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DOI: https://doi.org/10.1007/978-3-319-60970-6_1
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Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-60969-0
Online ISBN: 978-3-319-60970-6
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