hard · FRM Part 1 Quantitative Analysis
A trader uses two uncorrelated technical indicators. Prior for a 'bull signal' is 40%. Indicator 1: P(I_1|Bull) = 0.6, P(I_1|Bear) = 0.4. Indicator 2: P(I_2|Bull) = 0.7, P(I_2|Bear) = 0.3.
If both are positive, the posterior is:
- 70.00%
- 50.00%
- 85.00%
- 60.00%
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