STOCKS & COMMODITIES magazine. The Traders' Magazine

Article Archive For DEC1994

  • A Personal Neural Net Trading System by James Stakelum

    ARTICLE SYNOPSIS ...A Personal Neural Net Trading System by James Stakelum What goes through the mind of someone developing a neural network trading system? What are the steps involved in putting together something that mimics the mystery of the human mind? Here are some clues. Neural networks are a promising technology for quantifying the probabilities of rewards and risks in trading the global financial markets today. Although excellent neural network software products are abundant and available for the trader, I chose to design and program my own and then use my neural network software as the foundation for ...

  • Back To Basics In Trading Stocks by Gregory J. Kuhn

    ARTICLE SYNOPSIS ...Back To Basics In Trading Stocks by Gregory J. Kuhn Identifying the once or twice a year that the market is ready to embark on a very profitable move is the ultimate quest of anyone trading stocks. But in this day and age of artificial intelligence, with neural networks and fuzzy logic, using something as low-tech as the basic technical tools to find such opportunities may seem, well, backward. Gaining insight into the market's future direction doesn't have to be that complex. While many investors in late spring and early summer 1994 were perplexed over inflation worries, higher interest rat...

  • Create A Hybrid Indicator by Jim Ritter

    ARTICLE SYNOPSIS ...Create A Hybrid Indicator by Jim Ritter Interested in creating an indicator with a little bit of this from one kind of indicator and a little bit of that from another? Well, you're in luck. This may be your solution. Technical indicators are tools, and just like hammers, screwdrivers and pliers, everyone has about the same basic selection to choose from. That having been said, have you ever found yourself in a situation in which you need a unique tool that isn't in your toolbox? It's not a new situation, and it' s not limited to the world of carpentry and construction; it can occur in techni...

  • Letters To S&C

    ARTICLE SYNOPSIS ...LETTERS TO S&C DOUBLE EXPONENTIAL MOVING AVERAGES Editor, In ""Smoothing data with faster moving averages""(January 1994 STOCKS & COMMODITIES), author Patrick Mulloy refers to the steps used to calculate the 26-week one-parameter double exponential moving averages (DEMA1). Figure 6 is titled ""Weekly NASDAQ, 26-week EMA and 26-week DEMA1"" and its caption states the DEMA1 shows higher response to the changing prices than the single EMA. Actually, the principal reason for this greater responsiveness is that the plot for the EMA1 ""equivalent"" moving average of 26 weeks is being compared to...

  • Peter Mauthe Of Core Asset Management by Thom Hartle

    ARTICLE SYNOPSIS ...The Value Of Valuation Peter Mauthe Of Core Asset Management Money management is simply a process of identifying what to own and when. While there are a number of ways to do so, one unique way is the work of Core Asset Management's Peter Mauthe. STOCKS & COMMODITIE S Editor Thom Hartle interviewed Mauthe via telephone interview on September 22, 1994, asking him, among other questions, about how he views the markets and what his management techniques a re based on. By using mutual funds, we can make very quick, very cost-effective moves in our portfolio. We can move from large-cap stocks to ...

  • SIDEBAR: CANSLIM.

    ARTICLE SYNOPSIS ...CANSLIM CANSLIM is the acronym for the seven criteria that William O'Neil determined were the most important in identifying winning stocks. These are the key characteristics that were present just prior to many of history's best-performing stocks: C Current quarterly earnings per share: Should be accelerating. A Annual earnings increases: Look for meaningful growth. NNew products, new management, new highs: Buy at the right time. S Shares of common stock outstanding: Keep it small. L Leader or laggard: Find an industry's leaders, not laggards. I Institutional sponsorship: A little goes a...

  • Seasonal Tendencies For Range Expansion by K.D. Angle

    ARTICLE SYNOPSIS ...Seasonal Tendencies For Range Expansion by K.D. Angle This STOCKS & COMMODITIES contributor identifies the seasonal tendency of the commodity markets on a monthly basis and then compares the commodity market performance to a commodity fund manager's performance index. Is there any way to determine if there is an ideal time to start a trading program? The quick answer is no. Chance plays a much greater role in the near term and is a much smaller factor in the long term. But because it is impossible to predict what the markets will do in the future, it is also impossible to establish a trading...

  • Stress and Trading Success by Ari Kiev, M.D., J.D.

    ARTICLE SYNOPSIS ...Stress and Trading Success by Ari Kiev, M.D., J.D. First-time STOCKS & COMMODITIES contributor Ari Kiev, who is president of the Social Psychiatry Research Institute, discusses the role that stress plays in trading success and failure. Stress is a natural response to an event with uncertain results. The response to stress increases alertness to stimuli and enhances performance when associated with an increased flow of adrenaline. The stress response prepares you physically and psychologically for trading by increasing the blood flow to the brain and increasing your capacity for memory retrie...

  • The Price Oscillator by Bruce R. Faber

    ARTICLE SYNOPSIS ...The Price Oscillator by Bruce R. Faber What is this indicator and how can it be used? For neophytes to learn and seasoned traders who want to refresh their memories, check this out. The price oscillator. Don't let the fancy name throw you. Simply, this tool is the difference between two moving averages. The price oscillator can be constructed using either points difference or percentage difference. You can use either simple or exponential moving averages. By plotting the graph of the difference, you are observing the moving average with the longer duration as a straight line. The movement of...

  • The Warrior's Discipline Of Trading by Richard D. McCall

    ARTICLE SYNOPSIS ...The Warrior's Discipline Of Trading by Richard D. McCall This occupational psychologist and a master of martial arts compares the disciplines that traders need in order to trade effectively with the disciplines of the samurai. When was the last time you were in a fight? Think about it. Did you think back to a long-forgotten push-and-shove incident at some tavern when you were in college? Or did you think of some military campaign you served in? These combative recollections are likely to arise in the minds of most readers contemplating the question. But such answers would be inaccurate. In a...

  • Three Market Timing Strategies by Daniel J. Traub

    ARTICLE SYNOPSIS ...Three Market Timing Strategies by Daniel J. Traub Does market timing work? It depends on how you measure the results, according to this market timer. Here are three simple market timing strategies to help you understand the basics of market timing. Market timing may be the fastest-growing investment strategy of the 1990s. In 1993, Society of Asset Allocators and Fund Timers (SAAFTI) members reported growth rates in managed assets ranging from 25% to more than 200%. Driving that growth has been increasing awareness and visibility of professional market timers, a continuing assault on the effi...

  • Trading Markets With Stochastics by Louis M. Lupo

    ARTICLE SYNOPSIS ...Trading Markets With Stochastics by Louis M. Lupo There are many systems for trading these days, some of them good, some not. Here's a reliable pattern for trading markets using stochastic. Of the computerized trading systems and discretionary systems I have traded and developed, some needed refinement, some needed reworking, and some were simply cannonfodder. However, one system that has continued to perform in every hostile trading environment imaginable is the stochastic pattern recognition system. Let me briefly discuss the theory behind the system and describe the parameters of one part...







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