So much advanced mathematics is applied to the stock market these days that it can sometimes look like one big physics experiment rather than a basic way for the masses to invest in the fortunes of U.S. businesses. So it's curious how much attention Wall Street pays to one of the least-complicated math concepts there is: round numbers.Take the commemorative baseball hats that appear at the New York Stock Exchange whenever the market hits a milestone such as "Dow 10,000" and "Dow 20,000." Presumably, some hat company has an order on file for "Dow 30,000" lids that it's patiently waiting to fill. As long as they're round, even not-quite-noteworthy numbers can cause a sensation, at least temporarily, as witnessed by investors' current fixation with the S&P 500's struggle to push decisively above 2,800. Traders often place automatic orders known as "stops" to buy or sell an asset when it reaches a certain price. In theory, they set the price based on an in-depth analysis of fundamental and technical indicators. In reality, it often seems like they just pick a nice round number.
展开▼
