Australian (ASX) Stock Market Forum

T/A Bagged

Re: t/a bagged!

wayneL said:
LOL-NO!! But I had plenty of time to read it whilst missus was spending all my profit at Myers.

At least you took her while Myers was on sale (ended today)- smart trading there, made your money go further (for her)!!! ;)
 
Re: t/a bagged!

There are quite a few TA traders in Jack Schwager's Market Wizards books for example talking about how they've made huge gains consistently, they are well known as are their profits so it's hard to dismiss TA so lazily. Works for some doesn't for others.
 
Re: t/a bagged!

Kris,(Son) has just finished his BSC in Physics.

His specialty is Photonics as such he is working with the Uni of Adelaide in Research on his break before Masters.

Anyway a mate of his is doing a paper on Quant analysis studying market cycles and order.Ive asked if I can have a copy of his paper.
If and when I get it Ill let you know his findings.

By the way Ive had discussions with Kris whos maths skills arent all that tardy.Simply he insists-----maths can explain anything you like it can both prove your wrong in an arguement and right in the SAME arguement.

I didnt argue!!

Hey Rich--------Did you know that Shwagger failed dismally as a futures trader!!
 
Re: t/a bagged!

I'm half way through my course at the securities institute, and Modern Portfolio Theory and the Efficient Market Hypothesis were almost enough to make me sick.

Coming from an Engineering background I like a bit of fundamental explanation for how things work and tie together - but Modern Portfolio Theory is a joke. I think acedemics in finance would like to assume their feild of expertise (?) is logical and can be derrived from a few simple concepts. I think they should head over to the psychology dept. because as soon as you'r talking about markets you're really talking about humans - who tend not to always be logical.

In a related matter I have almost finished reading about the rise and fall of Long Term Capital Management. The fund which proved that the very academics that came up with modern finance theory failed to properly estimate the madness of markets.
 
Re: t/a bagged!

Ummm... Wayne, the book you saw is probably the newly released 8th edition. The 1st one was published in 1973. I haven't seen it, let alone read it, but your acidic review sent me off for a look at it on Amazon.

From the reviews, the essential message seems to be that the average inconsistently interested punter is better off putting money into index funds than in managed funds or stocks. Not quite such an ulcerating message as you might have thought? Not that I'd dream of arguing with you when I have so little information... but no mice were involved in the writing of this book; the author's surname is Malkiel <gdr>

Cheers,

Ghoti
 
Re: t/a bagged!

wayneL said:
<<<<<Wayne
Usually these guys are actuaries (like Richard Fitzherbert) or acedemics of some sort.

Perhaps it's how they are indoctrina.......er, I mean educated.

They like to crap on about acedemic studies that have discredited technical analysis. But as anyone who has had exposure to so called "scientific process" would realise, most "studies" are completely lacking in integrity. The desired result decided before the methodology, according to vested interests; the resulting methodology of the study reflecting this.
Definition of an actuary: a person (probably male) who uses highly technical and sophisticated methods to proceed from unwarranted assumptions to predetermined conclusions.

Ghoti (ex-insurance industry)
 
Re: t/a bagged!

Definition of an actuary: a person (probably male) who uses highly technical and sophisticated methods to proceed from unwarranted assumptions to predetermined conclusions.

Here are a couple of those.

(1) Latest research shows that 3 out of 4 people make up 75% of the worlds population.
(2) Reseach has shown that research causes cancer in rats!
(3) One For the technical and Fundamental analysts among us
The 50-50-90 rule.
When you have a 50-50 chance of getting something right there is a 90% chance youll get it wrong!!!!

Anyway I started out with nothing and still have most of it!

Cheers Tech
 
Re: t/a bagged!

Nice post Tech/Ghotib, very funny guys, keep em coming, no point in taking this stuff too seriously!!
 
Re: t/a bagged!

The 50-50-90 rule.
When you have a 50-50 chance of getting something right there is a 90% chance youll get it wrong!!!!

Excellent! :iagree:
 
'I've never yet met a rich chartist'

I found this interesting definition about chartists.

Charting

Many people use charting, otherwise known as 'technical analysis', to help them make decisions about timing. The fundamental idea behind charting seems to be that whilst it is impossible to know all the fundamentals behind a stock, all relevant information is revealed in its price movement. Of course this is a very dangerous assumption, as share price manipulation is rife on the Australian stock market, especially in the speculative sectors. A stock could also be rising or falling due to sentiment, which is not always soundly based and can quickly change.

My own attempt at a humorous summary of the basic rule behind charting is that a trend will continue until it doesn't. So, you simply buy when the trend is up, ride the trend until it stops and then sell at a profit. Very simple in theory...not so simple in practice.

There are a number of problems with using just charting as a basis for timing decisions; here are a few.

By the time the chart unequivocally suggests a buy, most of the run may have already occurred.


By the time the chart unequivocally suggests a sell, it may be difficult to do so because of illiquidity.


Many charts are choppy and would entail frequent buying and selling, but this creates significant transaction costs.


Charts are open to interpretation and sometimes even experienced chartists cannot agree, except in hindsight.
Add this to the fact that charting has to be learned and this inevitably entails a cost, and you will realise that technical analysis is not the magic wand that some sellers of charting seminars, software programs and books would have you believe. If someone claims that it is easy to make money through charting then, as suggested earlier, politely ask to see their tax returns for the years they made their big killing from it. There is a famous quote that goes, 'I've never yet met a rich chartist'. A bit harsh, but like the mining company definition, possibly containing a hint of truth.

It is worth mentioning at this point that not all chartists are the same. There are followers of Elliot Wave theory, Fibbonaci sequences, and so forth. They all have one thing in common though, a belief that certain patterns occur and recur for some often hidden reason and that it doesn't matter why something happens in the market, as long as you know that it is happening or will happen.

As I have made clear, I am a little skeptical of the chances of survival in the sharemarket using only charting.

Having said that, charting can be a useful tool in your ****nal, and at least a rudimentary knowledge is worthwhile if only because there are many chartists and it's good to know what they're likely to do.

The futures markets too, may be a different kettle of Plankton, and appear to lend themselves much better to technical analysis. The whole argument about exactly what sort of chaotic system the sharemarket represents and whether any kind of mathematical or charting based predictive technique can ever be reliable is a very interesting one.
 
WayneL,

Whilst I've read this thread with interest, there is one point I'd like clarified to put this thread into context.

Does this "Burton Mickymouse" define profitability as success OR outperforming the index as success?

As for the putting your money into index funds only, that sounds like he is suggesting that doing nothing in ignorance is a better strategy than learning, researching & applying those skills and knowledge in a systematic manner.

A little hard to swallow personally
 
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