# Introduction to Bloomberg Terminals

## Lesson 4 - The Scaling of Stock Prices

### 1. Video: Making Money from Pascal's Triangle

The mathematics of stock prices is fascinating. It has surprising links
to elementary subjects such as Pascal's Triangle and not-so-elementary
topics such as heat and diffusion. In this video we develop a theory
of the scaling properties of stock prices and connect it to other areas
of mathematics. Your task will be to check the theory is true using
Bloomberg data.

### 2. Exercise

Download a year's worth of data for the FTSE 100 and check that the
standard deviation in the change of the log of the stock price each week
is related as predicted to the change in the log of the stock
price every four weeks.

To do this you will need to use the standard deviation function in excel.
You can find this by clicking on the drop down menu on on the **Auto Sum** button
in Excel, then selecting **More Functions** and then **STDDEV**.