The Golden Ratio (Phi or Φ): 1.618 {1.61803398874989484820..}
The golden ratio is a number found everywhere in nature and in our universe. The golden ratio is widely used in technical analysis in order to determine if and when a financial market will continue its trend or reverse.
Fibonacci Sequence of Numbers
The Fibonacci sequence of numbers is very important for stocks investing and linked with the Golden Ratio. The name Fibonacci sequence was first introduced in the 19th century by Édouard Lucas, although the history of this sequence of numbers starts many centuries before Jesus Christ. Every number in the sequence is calculated by adding up the two numbers before it. The Rule is X(n) = X(n-1) + X(n-2)
Here are the first numbers…
|
1 |
2 |
3 |
5 |
8 |
13 |
21 |
34 |
55 |
89 |
144 |
233 |
377 |
610 |
987 |
1,597 |
2,584 |
4,181 |
6,765 |
Archimedes Constant (Pi or π): 3.14 {3.1415926535..}
Archimedes constant is the name given to the ratio of the circumference of a circle to the diameter. Pi is the key constant in any equation that involves circular or harmonic motion.
Euler's Number (e): 2.7182
Euler's number which is also called as the exponential growth constant, is the base for natural logarithms. In finance, Euler's number is very important and used to determine the compound interest.
The Black–Scholes model
This model was developed by Fischer Black and Myron Scholes, and later expanded by Robert Merton. Black and Scholes won the 1997 Nobel Prize in Economics for their discovery. This single equation helped in order to create the global derivatives market.
Important Numbers and Equations
Capitalinvestor.org (2013)
