Silicon Investor (SI) -- The First Internet Community

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 : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?

To: stockalot who wrote (19611)	10/17/2003 8:39:10 PM
From: Tim Bagwell	Read Replies (1) \| Respond to of 42834

do you find trading in a bear market is more profitable than investing in a bull market? Well, I think you phrased the question well. A bull market is something you invest in while a bear market is something that you trade. So for a person who likes to trade, a bear market should give better opportunities to trade with moderate risk. Trading in a bull market really doesn't make much sense except where you have special information. The big money is in the long term trend so ride it out. But I wouldn't say one is more profitable than the other, in general. For a contrarian, the bear can be more satisfying. Don't get me wrong. I'm not pretending to be a guru but these are just my observations. Anyway, these are things that I think a veteran, like Brinker claimed to be, should have known. Especially one who is taking a fee for providing timing advice. I've often said that where Brinker went wrong was in trying to apply bull market thinking in a bear market. You need to know which one you're in so you can adjust your thinking. So when he bet on Q's doing a CTR he was trying to do a bull market trade in a bear market (with a high volatility index!). He probably thought that a retest of the highs would occur and tried to trade into it. The thing was his model told him to be bearish and he ignored it. Had he been bearish he would have waited for a decline to more savorable levels before beginning trading. Consequently, he took on a huge amount of risk because once the bear decline set in he locked everyone in a struggle to beat back fears. It was not worth the risk and Brinker failed to overcome his fears. Brinker broke three cardinal rules IMHO. First of all, he should not have been trading if he thought a bull market was in play. Second, he was greedy. Thirdly, he should not have fought his model. He should have recognized the bear signals he was getting. Of course it's hindsight now but isn't this the kind of lesson that Brinker should be teaching? Another signal that was screaming at him was when the market went up further after his model flagged bearishness. That was a gift horse selling opportunity and should have been a screaming short. Instead, at the time he was ranting that short sellers were "rank amateur traders" - something that he would later prove himself to be. Anyway, he was totally wrong on that score. So now he's successfully called a bottom...which he admits is easier to do. But can he call the much harder top? What if he fails? How will he face his fears next time? What did he learn from his failures -- to be a quitter?