STOCKS & COMMODITIES magazine. The Traders' Magazine

Article Archive For AUG1995

  • Basic Techniques for Analyzing Systems by Mike DeAmicis-Roberts

    ARTICLE SYNOPSIS ...V.13:08 (348-351): Basic Techniques for Analyzing Systems by Mike DeAmicis-Roberts What should you consider when you're designing or testing a trading system? Here are some hints that may help you. Trading is all about fear and greed,"" a trader once said. He was right. Every trader has to deal with his or her own levels of fear and greed. Individuals have their own objectives for profit and tolerance for risk. Some traders want to achieve the greatest profit while ignoring risk, while others are looking for the smoothest equity curve. The system a trader develops should be aligned with th...

  • Dividend Yield Buy-and-Hold Meter by Elliott Middleton

    ARTICLE SYNOPSIS ...V.13:08 (329-331): Dividend Yield Buy-and-Hold Meter by Elliott Middleton Here's a comparison of the historical dividend yield of the S&P 500 on a monthly basis and what the 10-year total return for the S&P was after each observation of the dividend yield. How many times have you heard this: ""Over any 10-year period, you'll do fine in the stock market. Just buy and hold, don't try to time the market. Everyone knows you can't time the market."" Wrong. While generations of finance professors have been taught - and in turn have taught their students - that the stock market follows a random ...

Letters to S&C

  • Pattern Recognition and T-Bond Futures by Scott W. Barrie

    ARTICLE SYNOPSIS ...V.13:08 (352-358): Pattern Recognition and T-Bond Futures by Scott W. Barrie Pattern recognition is used to standardize and categorize market behavior into quantifiable market movements. After a collection of patterns have been identified, the market movement following each pattern can be measured. This post-pattern description can be used as a forecasting tool. In this article, Merrill waves are used as the basis for the patterns and forecasting. The goal of market analysis is to answer two simple questions: What is the direction of prices, and how much time will elapse before the direction...

  • Should You Trade Futures? by Jay Kaeppel

    ARTICLE SYNOPSIS ...V.13:08 (337-341): Should You Trade Futures? by Jay Kaeppel Here's some helpful advice to novices who are considering trading commodity futures. This should give you some idea of what's involved. And whether you should. Each year, many individuals take a deep breath, open futures trading accounts and begin trading on their own. Their reasons for doing so are numerous and diverse, but they generally fall into one of several categories. For the most part, these individuals have: ? Had a lot of success in stocks, mutual funds or bonds and want to parlay their winnings by branching out into f...

  • Sidebar: Constructing MW patterns

    ARTICLE SYNOPSIS ...V.13:08 (357): Sidebar: Constructing MW patterns Here are the formulas for identifying MW patterns using a Microsoft Excel spreadsheet. Columns A through E contain the date, open, high, low and close of the data you wish to analyze. In sidebar Figures 1 and 2, the data is September 1994 Treasury bond futures. Cell G1 has the filter size, which will be 0.01, but first, name the cell as a filter, using the insert-name-define keystroke sequence (see your manual regarding defining a name for a cell) and then enter 0.01....

  • Sidebar: Money Management

    ARTICLE SYNOPSIS ...MONEY MANAGEMENT There are two common ways of trading an account. The way an account will be traded in real-time should be the same as the way the system was historically tested. Otherwise, the analysis will be incorrect....

  • Stopping Points in Trading by Ari Kiev, MD

    ARTICLE SYNOPSIS ...V.13:08 (342-344): Stopping Points in Trading by Ari Kiev, MD This psychiatrist, who teaches strategies for trading success, discusses the identification and management of psychological stopping points that can limit your success as a trader. It happens to everyone sooner or later: Disaster strikes. When the market goes against you, automatic physical and emotional stress responses may manifest themselves as unplanned withdrawal or overtrading. When this occurs, a cycle of misinterpretation and overreaction to the marketplace remains alive until the trader can learn to deal with the advers...

  • The Nature of Risk: Justin Mamis and the Meaning of Life by Thom Hartle

    ARTICLE SYNOPSIS ...V.13:08 (359-365): The Nature of Risk: Justin Mamis and the Meaning of Life by Thom Hartle Looking back on decades of market activity can give anyone a certain perspective, and Justin Mamis, who writes the Mamis Letter, a newsletter for Hancock Institutional Equity Services that is a joint venture of Tucker Anthony and Sutro & Co., certainly has the experience to speak about. He became interested in the stock market in the post-Korean War period, and in the ensuing four decades has seen tops and bottoms, been an executive at the New York Stock Exchange (NYSE), worked in a specialist firm, tr...

  • The Utility Average Stock Market Indicator by Dennis Meyers, Ph.D.

    ARTICLE SYNOPSIS ...V.13:08 (321-328): The Utility Average Stock Market Indicator by Dennis Meyers, Ph.D. Here's a new indicator for trading the Standard & Poor's 500 index, based on the relative performance of the Dow Jones Utilities Average to the S&P. Trading rules and supportive studies are also provided. The Dow Jones Utility Average (DJUA) has long been acknowledged as a leading indicator for the stock market. The literature on the DJUA as a leading indicator has been mostly anecdotal. To date, no rigorously tested method using the utility average as a leading indicator has been published. That's easy...

  • Traders' Tips

    ARTICLE SYNOPSIS ...V13:08 (366): Traders' Tips TRADESTATION Several requests have been made for the code to Adam White's ""Weekly S&P trading system"" from the June 1995 Stocks & Commodities to be translated into Easy Language. Using the QuickEditor, I coded the formula as follows: ... In preparing the code, I created two user functions based on the trend analysis index (Tai) and the retracement of the low (LowRetr): ......

  • Trending on a Historical Basis by Alex Saitta

    ARTICLE SYNOPSIS ...V.13:08 (345-347): Trending on a Historical Basis by Alex Saitta The question is as old as technical analysis itself: Does the market trend? Here's a method to determine the degree to which markets trend historically. In addition, there's a comparison of various markets based on the observable degree of trend. In the pursuit of profit, most traders spend hours each day trying to forecast whether the market is about to trend upward or downward. However, some traders pursue their quest for profit in a different way. These traders are not concerned with the direction the market will move; rat...

  • Using Value and Technical Analysis by Thom Hartle

    ARTICLE SYNOPSIS ...V.13:08 (332-336): Using Value and Technical Analysis by Thom Hartle There are various ways to select what stocks to trade. Here's a method that combines fundamental value and technical analysis as a way to select a stock, and a real-world trading situation on which it was applied. Every trader has a limited amount of capital to put to work in a sea of stocks. The trader, much like a fisherman, casts a net over the water, culling for the keepers and discarding the little ones. In trading, the technique is referred to as screening , creating a list of stocks that qualify for further study a...







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