Profitability

Profitability (also called salability or saleability) is a technical analysis term used to compare performances of different trading systems or different investments within one system. The following definition was published in the journal Technical Analysis of Stocks & Commodities Magazine:Harris, Michael (September 2002). "Improve Your System With The Profitability Rule". (incomplete excerpt) Technical Analysis of Stocks & Commodities Magazine. 

Profitability = nProfits/nTrades - 1/(1+aveProfit/aveLoss)

This is computed for each system or investment being compared over the same period long enough to include significant "ups" and "downs". A suitable period is something like the last 5 to 20 years.

References

• Ayaz, Maryam (2007), "Sharia\'h and Profits", Revolutionary Islamic Revenue Generating Models

See also

• Profit
• Rate of return
• Islamic Banking, Finance & Economics by Maryam Ayaz

External links

• Pricing To Maximize Total Profits

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