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Top Articles - Is Volatility A Four Letter Word?
The Main Ingredient
Considering the week just past, with 200 point swings almost a daily occurrence, we thought this article on volatility to be timely. The majority of investors see volatility as not only dangerous, but something to be avoide
Considering the week just past, with 200 point swings almost a daily occurrence, we thought this article on volatility to be timely. The majority of investors see volatility as not only dangerous, but something to be avoide
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
d at all costs. They equate volatility with risk. But volatility and risk are two entirely different things.
To market timers, volatility is the precursor to profits. To have "no" volatility would be to have "no" profits.
In addition, to sing
To market timers, volatility is the precursor to profits. To have "no" volatility would be to have "no" profits.
In addition, to sing
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
le out one period of time when volatility is causing losses, is to miss the big picture which shows that, over time, volatility is the main ingredient to making huge profits.
Controlling Profits?
Consider this example of volatility.
Let's sa
Controlling Profits?
Consider this example of volatility.
Let's sa
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
that you enter the market with a starting sum of $1,000 and the market enters a substantial trend and you are ahead by 30%. Your original $1000 is now worth $1,300.
Then the market reverses and you drop down to $1,150. Is this a reason to pan
Then the market reverses and you drop down to $1,150. Is this a reason to pan
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
ic? If the trend is still intact, it is not. As trend followers, if we are still in the same trend, we may very well now move up to $1,500 or higher in short order. This is what trend following is all about... riding a trend to the end, not exi
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
ing at the first retracement.
But many traders would be devastated at dropping from $1,300 down to $1,150.
Too many market timers get upset for the wrong reasons. There is no way to control how profits are made. We can only ride the trends, a
But many traders would be devastated at dropping from $1,300 down to $1,150.
Too many market timers get upset for the wrong reasons. There is no way to control how profits are made. We can only ride the trends, a
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
s far as they will go, when they occur.
Market timers who follow trends have greater upside volatility than downside volatility because they "exit" losing trades quickly with small losses and "stay" with winning trades until the profitable tre
Market timers who follow trends have greater upside volatility than downside volatility because they "exit" losing trades quickly with small losses and "stay" with winning trades until the profitable tre
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
d ends.
The important thing to remember is that we stay with profitable trends, often for a long period of time.
When we start a profitable trend, we often make our profits in quick bursts of "volatility." That is why volatility is our friend
The important thing to remember is that we stay with profitable trends, often for a long period of time.
When we start a profitable trend, we often make our profits in quick bursts of "volatility." That is why volatility is our friend
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
, not our enemy.
We generate strong profits by correctly determining profitable trends and minimizing the cost of failed trends with quick exits.
When we have periods of sideways, non-trending markets, where there is no long term trend, we do
We generate strong profits by correctly determining profitable trends and minimizing the cost of failed trends with quick exits.
When we have periods of sideways, non-trending markets, where there is no long term trend, we do
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
not allow losses to accumulate.
When the market does break out into its next big trend, whether it be to the upside or to the downside, that is when we make our profits. And we do "not" exit the trend early. Exiting to protect profits assumes
When the market does break out into its next big trend, whether it be to the upside or to the downside, that is when we make our profits. And we do "not" exit the trend early. Exiting to protect profits assumes
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
you "know" ahead of time when a trend will end.
No one knows ahead of time. So we "must" allow the trend to complete before we exit. That means we will catch the "majority" of the trend, when it occurs, as profits.
Huge Volatility Equals Huge
No one knows ahead of time. So we "must" allow the trend to complete before we exit. That means we will catch the "majority" of the trend, when it occurs, as profits.
Huge Volatility Equals Huge
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
Profits
Invariably, the best profits come with the highest volatility. That means as trend followers, we must react to changes in trends, stick to our guns and make all the trades.
We may have some small losses when trends fail, but when the
Invariably, the best profits come with the highest volatility. That means as trend followers, we must react to changes in trends, stick to our guns and make all the trades.
We may have some small losses when trends fail, but when the
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
market finally breaks out (or breaks down), we make huge gains by riding the new trend as long as it lasts, to the upside in our bullish only strategies, and in both directions (long and short) in our more aggressive strategies.
By following a
By following a
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
set of rules, we do not have to agonize over protecting an open profit, nor do we need to constantly change our strategies to find ways to reduce volatility.
The question is not how to reduce volatility, but how to manage it with proper risk
The question is not how to reduce volatility, but how to manage it with proper risk
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
anagement. This means "not" allowing failed trends to accumulate losses, and "not" exiting profitable trends early.
Skeptics..
Skeptics mistake the volatility, used by trend timing strategies to make profits, as negative. But the opposite is
Skeptics..
Skeptics mistake the volatility, used by trend timing strategies to make profits, as negative. But the opposite is
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
true.
There is a big difference between volatility and risk.
Many investors see them as the same. But embracing volatility while controlling risk (cutting losses) is the key to successful trend timing.
We may see periods when profits are non
There is a big difference between volatility and risk.
Many investors see them as the same. But embracing volatility while controlling risk (cutting losses) is the key to successful trend timing.
We may see periods when profits are non
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
xistent for months or more. We may have several failed trends that generate small losses. But successful trend timers see these periods as the base for the next huge profitable trend.
In fact, we know extremely successful market timers who get
In fact, we know extremely successful market timers who get
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
excited when they see periods of sideways, non-trending markets as they know what comes next. The next huge trend is right around the corner! The longer the sideways market, the more profitable is the coming trend.
Unfortunately, many who do
Unfortunately, many who do
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
ot understand the logic of market timing by trading trends are not around when the big trends occur. They are sitting at their computers trying to find a new strategy that will guarantee gains while never allowing losses.
This is an impossible
This is an impossible
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
goal. Losses are inevitable. But so are the gains that are achieved by trend following strategies, taking the trades, minimizing the losses when trades (trends) fail, and riding the inevitable big trends for all they are worth when we get them
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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