Technical Analysis- Indicators & Systems Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Technical Analysis- Indicators & Systems

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Bruce A. Bowman who wrote (1414)	6/11/1997 10:45:00 AM
From: David Russell Coburn II	of 3325

Yes, I have no doubt that testing the intervals seperately will give vastly different results. I'm sure that tests over good stocks of the past 3 years would show much higher profits than over the 3 years prior to that. If you are trying to optimize your system for a particular market I would tend to agree with you about testing the different time frames. You could determine what types of profits/losses could be expected in particular markets and make adjustments to your systems accordingly. If on the other hand you are trying to play defense it is important to know the overall system profitability in all markets when they are combined. The advantage in testing 1 very long time interval is that you go through both the ups and downs in one test and the profit/loss reflects a sum of the profit from the combination of good times and bad times. I personally would rather have many small winners than I would the one big winner combined with many small loosers even if the overall test profits were more with the one big winner system. Since I only have a limited amount of money to invest and I wouldn't be able to buy every stock in the test the probabilities of my getting the one big winner is not so great. It's important to look at the standard deviation of the big winner and your likelyhood of purchasing the stock given a limited amount of funds. Since its important for me to play defensivly I need the systems that give me many small profits in all markets as opposed to the ones that make big money on a few stocks in the good market but kill you in the bad one. You never know what market you'll be in tommorrow. Again, I think the idea of optimizing "best-choice indicators / parameters" is very interesting. Again, I don't know but it makes a certain amount of sense that the big money that is attracted to a certain type of (stock/volume/price/../market) would often behave consistently when trading these markets. If you were able to identify what they were looking for and how they traded them you could ride along. I like cake too but I don't get it very often. I worked for quite awhile on trying to build digital filters that would locate frequencies in issues. Got the idea from "TAofS&C". I never was successfull. This, I think would be the ideal correlation of system to price movement. Sure looked easy in the article.<ggg> I definitely need to increse my database and develop a screening, scanning, or filtering process approach to buy selection. On splits your point is well taken that in a test the historical data has been adjusted downward. As far as adjusting the amounts around, I'm not sure I understand what your saying. I think you should invest a set amount regardless of the price to maintain deversification across your portfolio. This fact should be reflected in your testing. Therefore it shows that if you buy a very expensive stock you must get a lot of movement to equal a small priced stock with a much smaller price movement. I'm sure agree with this and that I simply am misunderstanding the last part of your post. Very nice posting with you, I hope you get to come to NJ. If you don't I certainly hope you will grace us with an article. David

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next