formula plan

Formula Plan

An investment strategy that calls for the buying and selling of securities according to a set formula. Both long-term and short-term formula plans exist, as well as high- and low-risk plans, but most rely heavily on previous market indicators. For this reason it is difficult to include a new issue of stock in a formula plan. Formula plans aim to eliminate personal opinions, emotions, and judgments from investing by never deviating from the formula.

formula plan

The buying and/or selling of securities according to a predetermined formula. This approach to investment decisions is intended to eliminate the investor's emotions and instead to follow a mechanical set of rules. A huge number of formula plans have been developed over the years.
References in periodicals archive ?
However, delivery rates are expected to go up in January 2013, under the new ComEd formula plan.
TEI believes that the final regulations should clarify that options and SARs automatically available under such a previously approved formula plan and that are subsequently granted by the compensation committee qualify for the grandfather transitional relief without regard to the time when the option is exercised.
Radio Formula plans for this new service to be on the air by end of 1999.