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The Dow Jones Industrial Average Will Be Forecasted Using A Normal Curve
The Dow Jones Industrial Average Will Be Forecasted Using A Normal Curve
M2D1: Forecasting the Dow Jones Industrial Average using a Normal Curve OpenPosts are due at 5:55 p.m. on Wednesday, June 16th. Monday, June 21st, at 11:55 p.m., is the deadline for discussion. (This is factored into the final grade.)
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A normal distribution can be used to characterize the relationship between sample attributes or events. The normal distribution can be used to predict and adjust for a wide variety of financial goals by optimizing financial decisionmaking by applying and graphically mapping financial data into a distribution set of variables (The usage of normal distribution in finance, 2011). Data is dispersed around the mean or anticipated value in the normal distribution curve (bell curve). A low
standard deviation means the data points are close to the data set’s mean, whereas a high standard deviation means the data points are spread out over a greater range of values. As a result, identifying whether or not particular financial events are normally distributed can be beneficial because those events are more likely to follow probabilistic patterns in the future.
In finance, normal distributions can be used to:
Calculate the likelihood of financial occurrences.
Financial events and/or products are compared.
Assist with risk evaluation
Return on investment projections (ROI)
Present information in an easytounderstand manner.
Statistical analysis of the distribution can be used to determine the accuracy of statistical data.
Monthly stock returns are frequently tracked by financial economists to see if they are regularly distributed. We’ll go back to the Dow Jones Industrial Average now. You can use what you’ve learned about the normal curve and Z score to make probability claims regarding the Dow Jones Industrial Average’s future returns and defend your estimates. Use the historical tool on The Wall Street Journal’s website to compute the mean and standard deviation for the month of August 2020
for your projections: https://www.wsj.com/marketdata/quotes/index/DJIA/historicalprices.
The following are the steps to completing this assignment:
1. In the date boxes, type 01/01/2020 in the first box and 12/31/2020 in the second box.
2. Press the GO key.
3. Click the Download A Spreadsheet button on the right side of the page.
4. Open an Excel spreadsheet that has all of the daily values.
5. The Close scores should be used as the daily raw scores.
6. Use Excel to determine the mean. If you don’t know how to use Excel, you need watch the videos. The average in Excel is the same as the mean.
7. In Excel, calculate the standard deviation. If you don’t know how to use Excel, you need watch the videos. For this project, you will use the standard deviation for a population in Excel. It’s called STDEV. P
8. Calculate the Z or standard score in a new column to the right of the near scores.
Another video to help you with this task may be found here.
9. Using the Z table, establish another column with the Area Under the Normal Distribution once you have all of your Z scores.
10. Now it’s time to do your research. Are there any days in the year that are notably different? What does your data graph look like if you used a line graph to represent it? Are you able to forecast how the DJIA will perform in August 2021? How can you know if your forecast is right by putting it to the test? Can you forecast how the DJIA will fare today in comparison to August 2020?
Your post must be at least 200 words long. Make use of research to back up your forecasts. This will be discussed in class.
https://www.wsj.com/marketdata/quotes/index/DJIA/historicalprices
http://www.sixsigmastudyguide.com/wpcontent/uploads/2014/04/ztable.jpg
The Dow Jones Industrial Average Will Be Forecasted Using A Normal Curve
RUBRIC 

Excellent Quality 95100%

Introduction
4541 points The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned. 
Literature Support 9184 points The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned. 
Methodology 5853 points Content is wellorganized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met. 

Average Score 5085% 
4038 points More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided. 
8376 points Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration. 
5249 points Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met. 

Poor Quality 045% 
371 points The background and/or significance are missing. No search history information is provided. 
751 points Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration. 
481 points There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met 

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The Dow Jones Industrial Average Will Be Forecasted Using A Normal Curve