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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Stock Farmer who wrote (54578)	11/3/2003 8:26:47 AM
From: Mathemagician	Read Replies (1) \| Respond to of 54805

And yet that's what Moore claimed he had done, isn't it? Maybe. I don't know if he had invested in any of those companies or not. What a-priori timeframe must we use to validate the results? Here we sit, four years from publication of the book. Through approximately equal measures of bull and bear plus some "recovery" turmoil. And the results in use by what has to be a collection of experts are... um... unimpressive. Even in comparison to the similarly unimpressive returns of the broad market. The frequently stated time horizon for those who practiced the GG here was 10 years. Also, don't forget that it was practiced differently here than in the GG book. Another variable is that the last four years have been extreme market conditions, not just 'ordinary' bull and bear conditions. We all get to mark our own standards of being impressed. Agreed. We can't have it both ways: a strategy that is good over long terms but which should be set aside during bear markets? Why not? Which you choose to use depends on your time frame, aggressiveness, risk tolerance, etc. Doesn't mean I have to be sympathetic to the subsequent post-crash moaning in either case, does it? Nope, but you don't have to publicly enjoy it or mock those who experienced it, either. It's a matter of class. Intriguing. Forgive me but I'm not confident I understand what you just asked. I am not so well versed in trendline analysis as you are. Perhaps a short course would be in order? Others here could benefit, I think. Reversal days are not related to trendlines. A reversal day is a day with a new high and a close lower than the prior day. Open just about any chart and look at the peaks and valleys, you'll find that most happen at or very near a reversal day. Buying reversal days at the bottom and selling at the top looks tempting. But, if you go through the rest of the chart, you'll find reversal days all over the place that would have been disastrous. So, the statement "Most tops and bottoms happen on reversal days" is true while the statement that "Most reversal days happen at tops and bottoms" is false. Many investors will research and agree with the first statement. However, success in actual trading relies on the second being true. Now, if you are willing to work harder and be smarter than the other guy (mostly work harder), you just might be able to profit from this knowledge. The guy who only looks into the first statement will lose. He reads about reversal days, looks at a few tops and bottoms, sees reversal days there, and is convinced so he employs the strategy in his account. He may experience some initial success, but is doomed to failure. Knowing this (being 'smarter'), you can start to look into whether or not the REVERSE strategy will be profitable at his expense. Again, more work, but this is the RIGHT KIND of work (working smarter?). It has the potential to lead to a strategy that will remain profitable as long as 'the other guy' doesn't wake up, or as long as every other guy that does wake up is replaced by a new investor who is seduced by the same phenomena. This is one reason I insist on fully automated computerized systems with no discretion. It's too easy to fall into traps like these. I also insist on having a pretty good idea who 'the other guy' is and why, so I know when my edge is threatened. Hope that helps! <font face=wingdings>e</font> P.S. This example was for illustrative purposes only. In no way do I advocate trading with or against reversal days. Do your own research!

To: Stock Farmer who wrote (54578)	11/3/2003 12:04:35 PM
From: Thomas Mercer-Hursh	Read Replies (1) \| Respond to of 54805

And yet that's what Moore claimed he had done, isn't it? John, in addition to unnecessarily personal attacks ... it is quite a different thing to tell something that you believe their idea is wrong and to tell them they are stupid ... one of the persistent problems on this board has been people either attacking Moore without having read him or attacking Moore without bothering to notice that this board had long since departed from Moore in those same areas. Moore is a very insightful thinker about the issues related to how and why high tech companies grow, fail, and whether their success is limited or huge. At one point someone convinced him that this should have something to do with investing and he took a stab at talking about that ... and now probably wishes he had sat on the idea for a while and thought about it more before putting it out there for everyone to see. Nevertheless, the book does raise interesting implications of his other work for making investment decisions, even though specific individual statements are overly simplistic or even wrong. Forgive the poor guy and stop trying to beat up on him like he was out there today trying to convince everyone that his original revealed word was still the absolute truth. He's not and we're not. That doesn't keep us from having a great deal of respect for his insight and what it provides to us in making our own investment decisions. Even if I were interested primarily in shiny pebbles, I would have a much better idea about what choice I was making based on this context.