Which one do you use? Technical or fundamental analysis?

[Realist]

Re: Which one do you use? Technical or fundamental analysis

The only way to seriously outperform everyone else is to do something everyone else isn't doing.

Why try and outperform Warren Buffett? Why not just copy him?

I'd be happy with 1% of his success actually.

He can be 100 times better than me at what he does and I'll be very happy with my return.

Like that ! Yep if everyone is trying to stick their paw into the cooky jar at the same time, how are you going to get any cookies?

You're not. But everyone else will. Put your bloody hand in the jar while you still can.

 

[Magdoran]

Re: Which one do you use? Technical or fundamental analysis

Bunyip, eddievanhalen, (even tech/a),


Applause.


Magdoran
P.S. I worry about the newer players being misled too…

 

[It's Snake Pliskin]

Re: Which one do you use? Technical or fundamental analysis

im no guru, but wouldnt u think u shud use both coz, a share price u wud think wud rise because of a fundamental reason?

i myself just enter in direction of trend,volume and keep stops tight, and look at fundys to make sure its making money..i make a little from a little :



cheers

David could you please write correctly?

 

[nizar]

Re: Which one do you use? Technical or fundamental analysis

Why try and outperform Warren Buffett? Why not just copy him?

I'd be happy with 1% of his success actually.

Really??

Its well documented that $10,000 invested in Berkshire Hathaway in 1965 would by 2005 have become $50million

Thats 24% annually compounded

You'll be happy with 2.4%... good effort son, i hope u dont have to do much research to get u there :

Oh sorry i actually worked out for 10%.... but im sure u get the drift...

There are many traders out there that make heaps more money than Buffet does... they just havent been around long enough to become as famous... but would u rather the cash or the fame?

 

[It's Snake Pliskin]

Re: Which one do you use? Technical or fundamental analysis

Bunyip, eddievanhalen, (even tech/a),


Applause.


Magdoran
P.S. I worry about the newer players being misled too…

Magdoran,
Just for the newbies who are they?

What are they being misled by? By whom?

If one has the authority to say one is being misled, then that person, or people, have a moral obligation to reveal what is misleading. That`s if there is a real concern for those being misled.

Snake

 

[It's Snake Pliskin]

Re: Which one do you use? Technical or fundamental analysis

Why try and outperform Warren Buffett? Why not just copy him?

I'd be happy with 1% of his success actually.

He can be 100 times better than me at what he does and I'll be very happy with my return.

You're not. But everyone else will. Put your bloody hand in the jar while you still can.

It`s very hard to copy Mr Buffett, even for Buffett wanna be`s.

If you have a spare few million dollars contact Mr Buffett and get some advice on how to buy a company and then build it up.

Yes, keep that hand in the jar and it might get bitten by an ant in it.

 

[It's Snake Pliskin]

Re: Which one do you use? Technical or fundamental analysis

Agreed. There's a lot of crap posted on this forum.

Perhaps there should be an ignore option?

Swingy,
Actually this is a better forum than most.

There is an ignore button that can be utilised.

Snake

 

[It's Snake Pliskin]

Re: Which one do you use? Technical or fundamental analysis

Hi eddievanhalen

It looks to me you're trying to have it both ways since you say you haven't made any claims but when I read your post you clearly make claims of various sorts. Personally I have no idea if your claims are true or not but it doesn't really matter.

What I find amusing is that people make unsubstantialted and unverifiable claims in chatrooms like this and then expect others to just blindly believe them ......I for one have always had and will always have a policy of not blindly believing what I read in chatrooms.

The way I see it, the more people get upset and aggressive towards those who justifiably choose to not believe unsubstantiated/unverifiable claims the more confident I am that their claims were horse manure in the first place because if their claims were true, I cannot see how on earth it should matter to them if I or anyone else blindly believes them or not......being aggressive/abusive towards other chatters indicates to me they have other agendas which require them to be believed for their agendas to be achieved.

cheers

bullmarket

Bull,

As always your philosophy is out there.

Pure entertainment :remybussi

Snake

 

[bunyip]

Re: Which one do you use? Technical or fundamental analysis

im no guru, but wouldnt u think u shud use both coz, a share price u wud think wud rise because of a fundamental reason?

i myself just enter in direction of trend,volume and keep stops tight, and look at fundys to make sure its making money..i make a little from a little :



cheers

David

What very few people ever learn is that the chart is one of the best fundamental analysts you can have on your team.
A technical analyst utilising a trend riding approach is really using fundamental analysis in the first instance, simply by looking at the chart and identifying the trend of the stock.

If you'd looked at the plunging charts of Sons of Gwalia, Pasminco, and HIH, there could have been no doubt that investors were dumping these stocks because they had lousy fundamentals.

Conversely, strong uptrenders like BHP, RIN and WPL clearly had money pouring into them from investors who believed their fundamentals were excellent.
Incidentally, while Pasminco was plunging south and heading for oblivion, Renee Rivkin was busy talking the stock up and giving it a buy recommendation, based on its good fundamentals!!!!!!!

I was trolling through some stocks one day when I came across a stock that was downtrending on the weekly chart. I immediately thought 'poor fundamentals' even though I knew nothing about the stock (which happened to be ION).
A couple of days later I got a call from a friend who is right into fundamental analysis. Just out of curiosity I asked him what he knew about ION. He confirmed that the stock had been getting negative reports in the various financial publications, and was fundamentally considered a bit of a basket case.
ION, as we know, ended up going broke.

The concept of using trend analysis to make an assessment of company fundamentals is just so alien to the average fundamentalist that he simply can't accept it as a viable way of assessing whether or not a stock is worth buying.

Bunyip

 

[Realist]

Re: Which one do you use? Technical or fundamental analysis

There are many traders out there that make heaps more money than Buffet does...

ridiculous.

If you have a spare few million dollars contact Mr Buffett and get some advice on how to buy a company and then build it up.

Buffett did not build Coke or Gilette or the Washington Post up at all.

Buffett is a stock analyst, he saw value in the Coke brand, saw the company was undervalued, bought stock, and Coke is still Coke and he's still making money from Coke. If you think Warren Buffett invented Diet Coke or something you are dreaming.

Every time you buy a can of Coke probably 0.1 cents go to Warren Buffett.

Every time you buy a can of VB about 0.00001 cents go to Realist.

Go on, have one!!

 

[wayneL]

Re: Which one do you use? Technical or fundamental analysis

Re outperforming Buffet.

I read somewhere (wish I could find the damned article so I could post it) that Buffet readily concedes that people can outperform him. There was only one condition, that the investor didn't have a huge capital base. Less than $1million was the figure mentioned I believe, from memory.

I think there are many on this forum who would bear that out.

Cheers

 

[Realist]

Re: Which one do you use? Technical or fundamental analysis

Buffet readily concedes that people can outperform him.

Absolutely.

Over the short term some traders will massively outperform Buffett.

Some wont though, some will lose money, infact most will lose money I'd guess.

But life and investing is no sprint race, it is a long distance endurance race.

No-one can beat Buffett over a long distance endurance race. Hence why he is so goddam rich. And we're not.

 

[wayneL]

Re: Which one do you use? Technical or fundamental analysis

Ahso! Found it!

Big Winners for Small Investors

By Paul Elliott (TMF Rael)
February 10, 2006

In 1999, Warren Buffett reportedly made the uncharacteristically bold guarantee that he could earn 50% profits on a portfolio of common stocks each year -- under one condition. Even better, he would accomplish this feat using ordinary, publicly traded stocks that you or I can buy and hold ourselves.

But even though Buffett meets with investors regularly and happily entertains questions from the gallery, he was uncharacteristically hard to pin down on this one point. He left the question open to much speculation, including plenty for years here at Fool HQ.

Enter a group of students from Kansas
While we were lollygagging about the water cooler, debating what exactly was said and when, a college investment class took matters into its own hands. These students trekked across the heartland and requested a private audience with this legend.

And these brave souls stood directly across the table and demanded to know ... Is it true? Did the investing genius really make his much-disputed "50% per year" boast? And more important, does he stand by it today?

Survey says ... Bing! Yes and yes! In fact, not only did this gentleman from Nebraska confirm what many already believed he'd first proclaimed back in 1999, he went one giant step further.

We know all about the gazillions Buffett made on consumer giants like $100 billion Coca-Cola (NYSE: KO). But here's something you may not know. To earn that 50% per year -- to double your portfolio every 20.5 months -- Buffett wouldn't buy Coca-Cola or even his own company, Berkshire Hathaway. He'd buy obscure little outfits with names you've never even heard. How can I be so sure?

Simple. Remember that condition I mentioned earlier? Warren Buffett guaranteed he could earn 50% per year ... if he had less than $1 million to invest. That's because the world's greatest investor would focus on undiscovered, lightly traded small caps -- the area of the market where individual investors have an advantage over the pros.

Why Warren wishes he were you
I know, that sounds crazy. After all, the big money on Wall Street has all the advantages, right? In fact, that couldn't be further from the truth.

Think about it. Pros have way more than $1 million to put to work. They can't mess with smaller stocks -- no matter how undervalued or how great the business. Well, at least they can't without risking running up the price (before their order is filled) or getting stuck with a controlling share of the business.

That's why you see all the trading volume in mega caps. Just take a look at the five most active stocks on the Nasdaq on a recent morning (last Monday, actually).

http://72.14.203.104/search?q=cache...on&hl=en&gl=au&ct=clnk&cd=15&client=firefox-a

 

[Magdoran]

Re: Which one do you use? Technical or fundamental analysis

Snake,


I could ask you the same moral question. Let’s just agree that you and I have “different approaches” and leave it there shall we?


Magdoran

P.S. I have my finger on the "ignore button" - click!

P.P.S. I suggest that newer serious traders/investors fully research and read the posts in the more professional sections (like Commodities and Derivatives), for those who want to continue in this comedy, please go for it!

 

[It's Snake Pliskin]

Re: Which one do you use? Technical or fundamental analysis

ridiculous.



Buffett did not build Coke or Gilette or the Washington Post up at all.

Buffett is a stock analyst, he saw value in the Coke brand, saw the company was undervalued, bought stock, and Coke is still Coke and he's still making money from Coke. If you think Warren Buffett invented Diet Coke or something you are dreaming.

Every time you buy a can of Coke probably 0.1 cents go to Warren Buffett.

Every time you buy a can of VB about 0.00001 cents go to Realist.

Go on, have one!!

Yes I`m quite aware that Mr B is not in marketing. :topic

Realist,

Here is a thought for you to ponder:

It is what it is. It is what it isn`t.
Those who blindly believe, believe. Those who don`t, don`t.
It is all in the numbers, but that doesn`t mean much to those who really know.

Snake

Closing point: technical or fundamental they are all relevant.

Enjoy everyone

 

[It's Snake Pliskin]

Re: Which one do you use? Technical or fundamental analysis

Snake,


I could ask you the same moral question. Let’s just agree that you and I have “different approaches” and leave it there shall we?


Magdoran

P.S. I have my finger on the "ignore button" - click!

P.P.S. I suggest that newer serious traders/investors fully research and read the posts in the more professional sections (like Commodities and Derivatives), for those who want to continue in this comedy, please go for it!

Magdoran,

Click that button baby.

Question:
How do you know when you have been taken for a ride?

Answer: On forums you don`t.

 

[nizar]

Re: Which one do you use? Technical or fundamental analysis

Absolutely.

Over the short term some traders will massively outperform Buffett.

Some wont though, some will lose money, infact most will lose money I'd guess.

But life and investing is no sprint race, it is a long distance endurance race.

No-one can beat Buffett over a long distance endurance race.

Thats because they havent been around long enough to give a fair comparison

Lynch made 29%pa for 13 years; and several others who run hedge funds made 30%+pa for 10 years or so (Richard Farleigh from memory is one of them)

 

[bunyip]

Re: Which one do you use? Technical or fundamental analysis

All absolutely true. My plan does all of this and so do I. So far, the plan (and I) are performing to (backtested) specification.

Really our only point of difference is in my belief that many "fashionable" entries are no better or even worse than random. Interestingly, I am currently reading Van Tharp's Trade Your Way To Financial Freedom which essentially supports that philosophy.

Let's settle on middle ground; the entry is the least important part of the trade for technical traders.

While the entry is generally considered less important than the exit, nevertheless I wouldn't discount the importance of getting a timely entry, no matter what Van Tharp says.

Try entering a stock at open on the day following a big spike up. Chances are you'll be quickly stopped out as the stock is knocked down by profit takers bailing out to lock in yesterdays gains.

Try buying a stock just below strong overhead resistance. Chances are that once it reaches the resistance level it will stall, and spend the next week or two chopping around until it gets your stop.

If you notice that a stock runs up for about 14 days on average, then has a pullback for a few days, try entering on day 12 or 13 of an upswing...chances are you'll be soon stopped out as a retracement sets in.

Try entering once the stock resumes its uptrend after a retracement. Chances are that the stock will accelerate away from your entry point and your stop won't be in danger. No guarantees, but that's the most likely scenario.
That's why I like entering from a trend resumption immediately after a retracement.....it puts the odds in your favour that you'll get an immediate move in the right direction.

As you can see, entires are an important part of trades. The entry is where the trade begins. Get the entry right and you increase the likelyhood of the rest of the trade falling into place.

Bunyip

 

[ducati916]

Re: Which one do you use? Technical or fundamental analysis

enzo

Dear Mr Ducster,

You do like to carry grudges don't you.

I respectfully decline your offer of a trading challenge. I also decline, in accordance with the agreement both you and I made to Joe, to indulge in acrimonious discourse with you. I will be honouring that agreement.

I didn't for one minute expect you to partake.
<code of conduct breach>

And while I'm still on the topic of excuses let's examine the evidence from the techies...........that is, claims of superlative trading results, combined with an excuse of why they cannot demonstrate


eddievanhalen

I am not going to even try and make any claims myself , but let's just say that I am in contact with traders all day every day and have seen trading statements/tax returns of my closer trading friends.

So no claims from you sir.

there ARE a few traders who are making 50,60,70,80,90% returns on large sums of money.

I thought you said no claims?
Where is the evidence?
What no evidence...........I'm scandalized.

Do you think I could be stuffed posting my trades (around 70 positions currently) and trying to prove myself to some people on the internet I don't know. I actually spend a lot of my free time helping other traders with general queries and am all for pointing people in the right direction but as far as trying to explain my system and prove it to everyone??

You can't post a few trades, that takes 5mins, but you can spend your free time helping the peanuts.

I should be extremely contrite in the face of such philanthropy. Jog on.

most of the traders I know making really big money from the markets do it full time. TechA does a fantastic job using a low maintainence system

No, now you are confusing someone who made a claim, and backed it up with a publically traded system Irrespective of his results, and as much as I quibble with him over his methodology........you cannot place your *traders* in the same category.

That's my piece - make of it what you will. I have made no claims about my own results - I have been making a living fulltime from the market from the age of 27 (currently 32) and have no need to prove myself to anyone.

But of course that's total nonsense.
You have made a claim right there.
*I have been making a living*...........that my freind is a claim, that implies you or any potential aspirant can make returns good enough to live off.

This is difficult.
You say otherwise.
Provide the evidence.

The only way to seriously outperform everyone else is to do something everyone else isn't doing.

Well here we can agree.
But *Technical analysis* is by definition, exactly what everyone else is doing.

The only reason I posted at all was to try (in vain probably) to maybe influence some of those who refuse to believe that returns greater than 10-20% pa are possible to think outside the square a bit.

They are, no argument.
There are people that do it.
Their results are in the public domain, and their funds are closed to new investors.

My assertion is that very few who participate on this BB are capable.
There are many claims.
Almost zero action.

Why is that?
Because to actually do it, day in day out, is very hard to do.
Most like enzo etc like to talk the talk, but bail out very quickly when required to put up the goods.

PS the only real "claim" I made to illustrate a point was that I currently hold 70 positions and TURN OVER 1m/month. When I say turnover I mean total sales. I could do that buying in and out of BHP 50 times for the month using only $20,000. It doesn't imply a level of profit

Of course it doesn't.
It tells people absolutely nothing.

bunyip

Thanks Ed.....that was an outstanding post. You show knowledge and wisdom beyond your years.
I doubt if you'll convince the non believers though....maybe one in fifty of them will be prepared to think outside the square he's living in, get off his backside and start putting in the hard yards necessary to learn a better and simpler way of profiting from the market.
Most of them however will continue to believe the age old crap that keeps them slugging along at 10 to 15% annual returns (if they're lucky) and believing that because they can't get above this level, nobody else can either.

More nonsense.
Buffett, Lynch, Gabelli, Ruane, Washington Post Pension Fund, etc.
All have publically verifiable records.
There are even some *techies* that manage it for periods of time.
Public knowledge.

<code of conduct breach>

What very few people ever learn is that the chart is one of the best fundamental analysts you can have on your team.
A technical analyst utilising a trend riding approach is really using fundamental analysis in the first instance, simply by looking at the chart and identifying the trend of the stock.

<code of conduct breach>

I was trolling through some stocks one day when I came across a stock that was downtrending on the weekly chart. I immediately thought 'poor fundamentals' even though I knew nothing about the stock (which happened to be ION).

<code of conduct breach>

The concept of using trend analysis to make an assessment of company fundamentals is just so alien to the average fundamentalist that he simply can't accept it as a viable way of assessing whether or not a stock is worth buying.

That's because it's total nonsense.
You are confusing the basics, and yet you claim so much.

Magdoran

Bunyip, eddievanhalen, (even tech/a),


Applause.

tech/a is worth his applause.
<code of conduct breach>
We'll come to blows on Friday.


jog on
d998

 

[wayneL]

Re: Which one do you use? Technical or fundamental analysis

Duc,

Last warning, cut the crap!