A 7-Month Simple Moving Average Would Approximately Equate with What $\alpha$

question 74

Essay

A 7-month simple moving average would approximately equate with what alpha ( $\alpha$ ) factor for simple exponential smoothing?

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Definitions:

Semi-Strong Form

A form of the Efficient Market Hypothesis suggesting that stock prices reflect all publicly available information, making it impossible to consistently achieve higher returns.

Strong Form Efficient

A hypothesis stating that all information, both public and private, is completely reflected in stock prices, meaning no investor can achieve higher returns with specific information.

Weak Form Efficient

A market efficiency theory stating that all past trading information is already reflected in stock prices, and that technical analysis cannot consistently produce excess returns.

Investment Risk

The possibility of losing some or all of an investment's value due to various factors including market volatility, economic conditions, or company performance.