Physical Sciences and Mathematics Commons^™

When To Stop Computing And Start Investing, Sean R. Aguilar, Olga Kosheleva

Departmental Technical Reports (CS)

Purpose: The purpose of the study is to analyze when -- while predicting the future price of a financial instrument -- we should stop computations and start using this information for the actual investment.

Design/methodology/approach: We derive the explicit formulas explaining how the resulting gain depends on the duration of computations.

Findings: We provide an algorithm that enables us to decide the computation time that leads to the largest possible gain.

Originality/value: To the best of our knowledge, this is the first solution to the problem. Following our recommendations will allow investors to select the computation time for which the …