Monday, January 16, 2017

Why do we Hedge the Underlying: Market Theory

Features VCE Features VGL Features MDS Features PDS Features EMS Features ALL SCOPE REQ.  Advanced Topic Discussion Qve

We are discussing the Qve Quantum Emulation of a Virtual Server, an advanced topic of emulating a virtual process within the context of a series of blogs found here: The New Virtual: Quantum Emulation

Emulation is a requirement when you can't complete an engineering task.  Why is it not a requirement when you can't complete a transaction?

In Market Theory hedging is a method of absorbing the volatility of the market on your portfolio. In life hedging may be simply saving time.  Saving time can mean setting aside some time to do what needs to be done or accomplished or refreshed.

Volatility comes about from the winds of change.  And what prime statements define the winds of change generally relate to 'the time and the tides'. In the old world the school of the seafarer said that the time and the tides were affected by extraordinary changes in the aspects of the moon, the sun and the seasons.  As far as people knew their own internal clock was operating the same way, as the universe seemed to be intrinsically connected.

 In the new world of the modern age, the time and the tides often relates to the mechanics of human driven activity.  We find this faulty in theory, since events are themselves planned before we exist and are driven by the Owner of the Universe to derive ends for which we must consider.

So in terms of risk management or risk mitigation we can justify the change in our portfolio based only on the stakeholder's requirements.  Simply because a person builds a clock does not mean they control the time and the tides, they can only study them.  There has always been limits to what we as humans can measure and articulate about change in conditions that influence our position.

And our position has a number of discrete measures in it that relate to time and motion. Those discrete measures are based on a number of changes in aspects.  And those aspects reveal a complete picture but only after the assessment of the entire change is complete.  In other words you could be jumping to conclusions if you run a set of numbers before the books are closed.

That sounds simple enough, but we are guilty of going off on a tangent based on hearing a simple rumor or innuendo.  It often creates a market climate of drifting from basics.  Senior people are always warning not to try to regulate the market, simply wait for it to right itself.  Like complex mechanisms they do indicate a very intricate picture.  Why do we make these mistakes?

The Pip has moved as much as the Pip Pin
Pip Used for listed equity securities. Smallest unit of a currency (i.e., cents for US dollars).
There is very little sense in our definition of metrics in the market place (Our comments)

You will notice in the illustration above when scale and quonics are working there is NO GAP. The smallest unit of measure in PI is the correct relation to prevent decoherence and that can only be achieved at the smallest functional unit of  quark qubit domain.

We don't emulate, model and simulate enough.  We don't estimate beyond layers that we consider norms or try to assimilate information beyond the walls of our conscious horizons.  We call it spooky action at a distance when in reality it is technology and information that can be shared.

It is not shared because it is considered the peculiar domain of groups.  And the only reason it is peculiar is because we haven't taken it apart and measured it in relation to the whole.

We say this because we believe that we have not gone deep enough into the study of intricate matrices to know how to project into the future the outcome of certain events.  The information is available we just haven't branched out to engage with it.

Information in the Owner's Library is stored at the level of the particulate.  Thus far only certain groups have capably studied and somewhat articulated their learning about these structures.  But that is not a comprehensive knowledge, which can be ascertained with appropriate tools.

The fact that global markets, materials and measurements have changed without our instruments for measuring change accommodating this, has been somewhat puzzling.  We noticed that in fact project measurement is far better for assessing the market structure as a PMO than corporate financial mechanics.  But no one is listening to the appropriate advice.  Metrics have more bearing on our position than broad position statements.  If we were running a ship, we'd believe we were in France, not in Japan.

Looking at the structure another way, things have moved on the smaller basis of materials and processes that we are not assessing in terms of their financial strength to define the market.

We have identified through our research that the world has changed in its dimensional attributes quite a bit regarding format over the past 50 years.  But everyone insists that it operates as it once did, and that assessment is wrong as well.  So, we suggest, that branch mechanics ought to be given a much more serious look, simply on that basis. 

You can not measure that which you can not articulate.  You can not articulate that which you do not study or develop concepts that work in relation to changes on your horizontal or vertical position. Emulation and Simulation are requirements in global market theory with far-reaching consequence. The instruments for change measurement have to project beyond the wall.

Time and the Tides wait for no man.


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Brij Consulting
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