Simple Solution

I received this case study again from my papa, which is quite interesting. I do agree with simple solutions. I want you all to read because it can dazzle you for sure!!!

One of the most memorable case studies on Japanese management was the case of the empty soapbox, which happened in one of Japan ‘s biggest cosmetics companies. The company received a complaint that a consumer had bought a soapbox that was empty.

Immediately the authorities isolated the problem to the assembly Line, which transported all the packaged boxes of soap to the delivery department. For some reason, one soapbox went through the assembly line empty.

Management asked its engineers to solve the problem.

Solution #1: Post-haste, the engineers worked hard to devise an X-ray machine with high-resolution monitors manned by two people to watch all the soapboxes that passed through the line to make sure they were not empty. No doubt, they worked hard and they worked fast but they spent a whoopee amount to do so.

Solution #2: But when a rank-and-file employee in a small company was posed with the same problem, he did not get into complications of X-rays, etc., but instead came out with another solution.

He bought a strong industrial electric fan and pointed it at the assembly line. He switched the fan on, and as each soapbox passed the fan, it simply blew the empty boxes out of the line.

Moral

  • Always look for simple solutions.
  • Devise the simplest possible solution that solves the problems.
  • Always focus on solutions & not on problems

Pivot Points for Stock Prices Predictions

I am always curious to know about stock exchange and how price of any stock changes. I always wonder that how market analysts can predict prices. I was googling and I found one Pivot Points method to predicte prices. I never tried this method but It is always interesting to know such method. We can try to just see how it goes with real market.

  • Method #1: Five Price Points Pivot Method. There are five equations as below,
  • R2 = P + (H – L) = P + (R1 – S1)
    R1 = (P x 2) – L
    P = (H + L + C) / 3
    S1 = (P x 2) – H
    S2 = P – (H – L) = P – (R1 – S1)

    Here,
    S = Support Levels,
    R = Resistance Levels
    P = Pivot Point
    H = High
    L = Low
    C = Close
    Note: The high, low and close in 24-hour markets.

  • Method #2: P = ((Today’s O) + Yesterday’s (H + L + C)) / 4
  • Here,
    O = Opening Prices. Support and Resistance Levels can be calculated by equations of Method #1.

  • Method #3: Developed by TomDeMark.
  • Here,

    Condition

    Calculation

    Tomorrow’s Projections

    Today’s Close < Today’s Open X = (Today’s High + Today’s Low + Today’s Close + Today’s Low) High = X/2 – Today’s Low
    Low = X/2 – Today’s High
    Today’s Close > Today’s Open X = (Today’s High + Today’s Low + Today’s Close + Today’s High) High = X/2 – Today’s Low
    Low = X/2 – Today’s High
    Today’s Close = Today’s Open X = (Today’s High + Today’s Low + Today’s Close + Today’s Close) High = X/2 – Today’s Low
    Low = X/2 – Today’s High

Interpreting and Using Pivot Points
When calculating pivot points, the pivot point itself is the primary support/resistance. This means that the largest price movement is expected to occur at this price. The other support and resistance levels are less influential, but may still generate significant price movements.
Pivot points can be used in two ways. The first way is for determining overall market trend: if the pivot point price is broken in an upward movement, then the market is bullish, and vice versa. Keep in mind, however, that pivot points are short-term trend indicators, useful for only one day until they need to be recalculated. The second method is to use pivot point price levels to enter and exit the markets. For example, a trader might put in a limit order to buy 100 shares if the price breaks a resistance level. Alternatively, a trader might set a stop-loss for his active trade if a support level is broken.

PS: I have used Yahoo! Finance and Investopedia for my references.