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You must not give too much weight to the averages, but should determine the position of each individual stock which composes these averages. … The law of averages works when applied to life insurance. The actuary can figure the lives of 1000 men at various ages and tell on an average how many of them will die each year, but the actuary cannot figure on one individual and tell when he will die from the position of the average because of the fact that men born at different s are grouped under the same average. Stock averages are also made up of stocks from companies which are 5, 10, 20, 30, 50, and 100 years old. With such a wide difference in the of the incorporation, and with the industries located in different parts of the country and influenced by local as well as other conditions, it is only natural that some of them must go opposite to the trend of the average group. |
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