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Strategies & Market Trends : The Rational Analyst -- Ignore unavailable to you. Want to Upgrade?

To: ftth who wrote (1429)	9/16/1998 3:15:00 PM
From: HeyRainier	Read Replies (1) \| Respond to of 1720

[ Today's Trade ] Today's Sniper Trade: Short Legato Systems (LGTO) at $53.50. RT

To: ftth who wrote (1429)	9/18/1998 1:46:00 PM
From: HeyRainier	Read Replies (1) \| Respond to of 1720

[ Statistics ] I was doing a little statistical study on the daily return for two stocks, GYMB and LU, in particular the price behavior during certain trends. One is definitely up, and the other, down. Here's why using the trend to your advantage makes sense: the average (mean) return for such trends during the period under consideration for GYMB (4/2/98 to yesterday) was -1.01%, while for LU (1/21/98 to 8/27/98) it was +0.52%. I of course took extreme samples for illustration purposes, but the lesson should be clear: you subject yourself to statistical forces, either positive or negative, depending on which side of the trend you operate on, long or short term. My last two trades with LGTO and OME serve to illustrate this point: for one, I waited for the trend to break for the short term, while for the other, I didn't. My return was a direct function of the side of the trend I took: the winner went with the trend, and the loser went against the trend. RT