A trading rule which signals purchase of a stock if it rises X percent and sale of a stock if it falls X percent is known as a
A) breakout.
B) short sale.
C) sieve.
D) filter.
E) relative strength.

Question

Quizplus · Accepted Answer

The given trading rule is a type of filter that is based on a certain percentage change in the stock price. It signals a buy or sell decision based on the stock's movement relative to the specified threshold, indicating a filter-based approach. Breakout refers to a phenomenon where a stock's price moves beyond a previously defined range or resistance level, while short sale involves selling shares that are not owned, betting on a decline in their value. Sieve and relative strength are not relevant to the given context.

A Trading Rule Which Signals Purchase of a Stock If