The Skinny on Options: Abstract Applications - July 12, 2021 - Why the Markets Move Higher Over Time

published 1 week ago by tastytrade, Inc.

With anything in the world of finance, there is always a mathematical explanation and an intuitive explanation. The fact that the market is structured to drift higher over time is no exception to this rule. From the Geometric Brownian Motion foundation all the way to the Capital Asset Pricing Model, today we learn the fundamental reason for the market’s slow drift higher over time - supply and demand.

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