Technical vs fundamental trading

[CaerMyrddin]

Thanks for the reply, Euler. I'm waiting for "The Intelligent Investor" to arrive home, I'm refining my strategies yet. Let's see how that develops.

Thank yuo for your help.

[Iron]

Hi CaerMyrddin

You might be interested in this book:

http://www.amazon.co.uk/How-Make-Money- ... 0071614133

It covers both technical and fundamental trading. I can't comment on the fundamental approaches outlined in the book, but it seems very well written.

I bought the book because it was recommended by a guy who turned $10,000 into millions.

Jeff

Thanks for the reply, Euler. I'm waiting for "The Intelligent Investor" to arrive home, I'm refining my strategies yet. Let's see how that develops.

Thank yuo for your help.

[CaerMyrddin]

Thank you Jeff, I'll give it a look, although the cover is somewhat discouraging?

[Iron]

Never judge a book by its cover!

Sorry, I couldn't resist!

Jeff

Thank you Jeff, I'll give it a look, although the cover is somewhat discouraging?

[CaerMyrddin]

I had it coming

[Euler]

Every few years I re-read the intelligent investor and each time it makes more and more sense. This has to be the best value oriented book available.

[CaerMyrddin]

Returned package from amazon, another week to get it

[Euler]

This is interesting: -

http://www.value-investing.eu/papers.aspx

[Euler]

Buffett's letter to shareholders is a decent read this year: -

http://www.berkshirehathaway.com/letters/2010ltr.pdf

[Quinny]

I am still awaiting the answer here.

There is only ONE thing(literalist can eff off at this juncture) that makes a company successful.

If you never recognise this fact it doesn't mean you can't still be a winner.

But...
Once you truly get it, golly! it makes it all so transparent.

As an example, ask yourself how and why M&S turned their fortunes around.

Or... What makes Warren Buffet's company so successful?
BIG clue there.

Or, why was there never likely to be a penalty in CHE v MANU game tonight.

Google this... "How To Sort The Wheat From The Chaf"

[CaerMyrddin]

Imthecrypticquinny?

[Iron]

Interesting quote:

"This idea that you can beat the pros as an active trader by following the news will be an expensive proposition — guaranteed. You may indeed be cleverer than average, but you’ve got to be quite a lot cleverer than average. There are many great, clever people out there and they spend their lives 24/7 working to extricate profits from the markets. At least with a trend following philosophy you have a chance."

From The Little Book of Trading: Trend Following Strategy for Big Winnings by Michael Covel

I suspect Covel is right, and that the people who can make fundamental-based investing pay are right at the edge of the Bell Curve...

Jeff

[superfrank]

"This idea that you can beat the pros as an active trader by following the news will be an expensive proposition — guaranteed. You may indeed be cleverer than average, but you’ve got to be quite a lot cleverer than average. There are many great, clever people out there and they spend their lives 24/7 working to extricate profits from the markets. At least with a trend following philosophy you have a chance."

People have been making fortunes trading gold long for many years now - many will be trend followers (clever ones and numpties), while many will be buying for fundamental reasons (clever ones and numpties).

[Iron]

But there's a big difference.

Over 10,000 trades, you'll only succeed as a fundamental trader if you're exceptional.

Over 10,000 trades, you'll only fail as a trend follower if you deviate from the script (which doesn't require much intelligence, but needs a hell of a lot of mental strength).

Jeff

People have been making fortunes trading gold long for many years now - many will be trend followers (clever ones and numpties), while many will be buying for fundamental reasons (clever ones and numpties).

[superfrank]

Fundamental traders don't purely base their decisions on their fundamental views - they also use technical analysis to decide on their entry/exit points. It's just they they choose which way to trade an instrument based on other things than just looking at a chart - calculating value with an extra variable.