Stocks and Shares · Building an equity strategy · lesson 7 of 9 · 6 min read · David Alexander
Sample size, when the firings cluster
effective sample size
The number of genuinely independent observations in a record - always smaller than the trade count when firings share market moments. Equity setups fire in clusters: one earnings season, one rate shock, one sector rotation triggers dozens of names at once, and forty simultaneous trades are closer to one observation than to forty. The equity sample problem is not scarcity but pseudo-abundance.
This lesson is part of the advanced modules.
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