Weibull Distribution...

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Has anyone looked at or know of/about the Weibull Distribution?

https://en.wikipedia.org/wiki/Weibull_distribution

I was reading article on LED performance and the critical factors of current and heat. How they influence LED >xx% luminance life expectancy. ref: Philips Lumileds.

Apparently is vip to know about LED o/p relative to life/xxhrs due to commercial issues blah, blah.

Anyway, the article mentioned the universally used Weibull Distribution function. A statistical technique to extrapolate product performance.

The word extrapolate stood out since inference/prognostication/.. is interesting in the trading world...

So, this leads nicely to someone that has maths ability and possible relevance to tick data or?

Any takers?

In anticipation!

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I put this out as have seen some [for me] mind blowing chat in the maths area by some site visitors - so the 'smarts' are obviously lurking here :o)

 

Hi fbj

I am an engineer and I have come across this distribution in the analysis of data from the bathtub curve that is a graph of lifetime failures of electronic components and equipment. Like all distributions it formulates an area where the components are least likely to fail but you only see it after the data has been collected. This is the very reason components are put on test in continuous mode so they will fail long before they get to market and give advanced warining to the manufacturer so they can adjust or arrange for repacement refits before the customer knows anything about it. What is it used to extrapolate? Does it guess at whrere the price is going or the market direction?

 

Thank you for your comment Ruptor. Apparently it has been used for price, S/R and other related in the future forecasting. Non-runner perhaps unless really understand and anyway, must be many other functions more suited to financial markets. Just one of many possibilities I'd guess ;)

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" The distribution of time intervals between price changes gives us important pieces of information about the market"

This intriques me - price on its own is what I like to use, however, never been able to narrow down my field of view enough to target specific field of study. The above quote came from The distribution of first-passage times and durations in FOREX and future markets. 4aug2008 page.2/para.1

But... this is maybe relevant - I'm going to tackle the article and at least read (even tho is very, very, over my head!)

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" Recently, various on-line trading services on the internet were established by

several major banks. For instance, the Sony Bank uses a trading system in

which foreign currency exchange rates change according to a first-passage process."

This from page.2/para.2

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" The Weibull distribution is often used for modelling intertrade durations in financial markets"

and from page.3/para.2

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What a laugh... gotta firstly get head around " inter-trade durations"

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again, thanks for your interesting reply

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