Hey! Before discussing a series’ convergence or divergence, you have to know what convergence and divergence are.
Now Take a look into what the convergence or divergence of a series is, Firstly take a look into what is the convergence or divergence of a series.
Convergence of a series
As you Know series is the sum of a sequence of numbers, if the sum of a series approaches some finite value then it is known as convergence of series. convergence of a series is the series that approaches a set limit is known as convergence of a series. It is used to describe the phenomenon of the futures price and the cash price.
Example:
- Traders refer to convergence as a way to describe the price action of a futures contract
Divergence of a series
If the sum of a series approaches some infinite value then it is known as the Divergence of series. Divergence of a series is the series that does not approach a set limit is known as Divergence of a series. It can be either positive or negative.
Example:
- positive divergence occurs when a stock is nearing a low but its indicators start to rally.
- negative divergence happens when prices go higher while the indicator signals a new low
In the end, We have concluded that if the sum of a series approaches some finite value then it is known as convergence and if the sum of a series does not approach some finite value then it is known as divergence.