Gets me in trouble too. I made the most complicated spread sheet
of all times about a week ago. I worked and worked and had
just about every thing I could think in it. This was a
masterpiece, and as I looked at the results it spit out I became
so dam confused that it dawned on me , no pattern or combination
of patters can fit every situation.
I was trying for one that could lead every curve that had a
3% or more change, and there was no way.
I now know what happened to the LTCM geniuses, they tripped over their
own intelligence. I blew the fancy stuff off and made me a
real simple one. It don't work all the time, not even half
the time, in fact only once in a while, but when it does
work it's never wrong.
---------------
It's based on the theory that yes small caps can go up faster
than big caps , but not often. However the Big caps must at
least be moving up, as if the small caps go up at the expense
of the big ones , and not because of new money. Then the market
is going to turn down. If you catch the Sml ones going up
with the big ones going down, you can short without fear.
This don't happen very often, and someday it may not work,
but that will only be after the rules are changed, and
cap weighted index trading is outlawed, or the market has
such a BIG melt down that index tracking funds all go broke.
I'm talking about a melt down that's so big that it don't even
leave money enough to pay the shorts off in any thing but
IOUs.
Jim |
