STOCKS & COMMODITIES magazine. The Traders' Magazine

Article Archive For JAN1995

  • Avoiding Risk: Jerry Wagner, Fund Timer by Thom Hartle

    ARTICLE SYNOPSIS ...Avoiding Risk: Jerry Wagner, Fund Timer by Thom Hartle Jerry Wagner, president of Flexible Plan Investments, Ltd., of Bloomfield Hills, MI, currently has approximately $200 million under management. His firm was the top-ranked market timer for the last seven years in the MoniResearch newsletter's 1993 annual survey of market timer performance. He is a founding member of the Society of Asset Allocators and Fund Timers (SAAFTI), a nonprofit trade association of registered investment advisory firms that manage client assets with market timing. Stocks & Commodities Editor Thom Hartle interviewed ...

  • Defining The Commodity Channel Index by D.W. Davies

    ARTICLE SYNOPSIS ...Defining The Commodity Channel Index by D.W. Davies Presented here are the ins and outs of the commodity channel index, as defined by creator Donald Lambert and modified by the author. The trials and tribulations of trading, the probability of ruin and the frustration of personal frailties lead most traders to pursue trading's Holy Grail - but the Holy Grail, like beauty, is in the eyes of the beholder. To Donald Lambert, trading's Holy Grail was to devise a technical tool that would identify the beginning and the end of cyclical and/or seasonal price trends and limit the possibility of loss...

  • Designing A Personal Neural Net Trading System by James Stakelum

    ARTICLE SYNOPSIS ...Designing A Personal Neural Net Trading System by James Stakelum What goes through the mind of someone designing a neural network trading system? Last month, James Stakelum explained some of the steps involved in putting together a neural network. This time, he talks about the choices he made to design a neural network to apply to the financial markets specifically. Last time, I detailed the general issues I found important regarding the overall design and composition of creating my own neural network. This time, I want to explain the choices I made to design a neural network for the specif...

  • Identifying Trades With The Option Premium Ratio by Christopher Cadbury

    ARTICLE SYNOPSIS ...Identifying Trades With The Option Premium Ratio by Christopher Cadbury What is the option premium ratio? Simply, the option premium ratio is the ratio of price premiums on puts relative to price premiums on calls. It covers all listed equity options. As explained in previous articles, this ratio has some remarkable characteristics relating to momentum. I have found that significant market rallies follow the positive momentum supplied by several consecutive days of gains or unchanged values in the ratio and by several consecutive daily gains in the Dow Jones Industrial Average (DJIA) at low ...

  • Letters to S&C

    ARTICLE SYNOPSIS ...Letters to S&C This month's letters include queries into fast Fourier transforms (FFTs), information on where to get historical data and data downloading services, the futures liquidity column, candlestick formations, and portfolio management....

  • Leverage And Commodities by J.M. Malley

    ARTICLE SYNOPSIS ...Leverage And Commodities by J.M. Malley Malley explains how to determine the appropriate amount of leverage for commodity trading. A winning trading system is a worthy goal, but there's the question of how much to put on in a trade or, equivalently, how much to lever yourself up in a trade. That aspect of trading, money management, is usually addressed with platitudes or difficult and inexplicable mathematics. Simply, risk, which is the probability of losing, is what you work toward reducing when you improve your trading system. Exposure, which is the amount you can win or lose, is controll...

  • Quantifying Your Markets by Thom Hartle

    ARTICLE SYNOPSIS ...Quantifying Your Markets by Thom Hartle After you've gained some experience with trading, you'll begin to notice that the market you trade has some typical characteristics. Have you ever considered quantifying them? Here are some ideas on the subject. Buy low. Sell high. Limit your losses. These are all tried-and-true trading axioms, all often stated but rarely quantified. So what does ""low"" or ""high"" mean ? What about that old chestnut, ""limiting your losses""? Are there really ways to intelligently limit your losses? Think about this: Experts recommend that you place stop-loss orders...

  • Relative Dividend Yield And Technical Analysis by Thom Hartle

    ARTICLE SYNOPSIS ...Relative Dividend Yield And Technical Analysis by Thom Hartle To trade the stock market effectively, you need a plan to pick out the stock that could outperform others. Here's an example of a plan for trading that uses a stock's relative yield to the broad market and technical analysis. Trading stocks for short-term or long-term investing is similar to playing a very competitive game. To be successful, you have to have a game plan, and the first step in the game plan is to have a decision screen for selecting stocks. The universe of stocks from which you have to choose is very large and you ...

  • Sidebar: Defining The Commodity Channel Index by D.W. Davies

    ARTICLE SYNOPSIS ...Sidebar: Defining The Commodity Channel Index by D.W. Davies Presented here are the ins and outs of the commodity channel index, as defined by creator Donald Lambert and modified by the author. The commodity channel index (CCI) can be calculated using any lookback period chosen by the trader. The Excel spreadsheet shown here is an 11-period CCI for the Dow Jones Industrial Average. The first step is to calculate the daily typical price. This is the high, low and close added together and divided by three....

  • Sidebar: Leverage And Commodities by J.M. Malley

    ARTICLE SYNOPSIS ...Sidebar: Leverage And Commodities by J.M. Malley Calculating leverage and simulated trading spreadsheets using a Microsoft Excel 4.0 spreadsheet for calculating L and simulating trading....

  • Sidebar: Risk of Ruin

    ARTICLE SYNOPSIS ...Sidebar: Risk of Ruin This brief sidebar discusses the risk of ruin- an estimate that indicates the probability that a trader will eventually lose all his trading capital- and the probability from zero to 100% that a trader will eventually lose all of his trading capital....

  • Sidebar: The T-Test

    ARTICLE SYNOPSIS ...Sidebar: The T-test by James Stakelum There were 24 trades produced in the simulation run using the September 1994 Deutschemark futures contract. This sidebar gives sample calculations of the T-test using these figures....

  • Sidebar: Trading And The Emotional Boomerang by Adrienne Laris Toghraie

    ARTICLE SYNOPSIS ...Sidebar: Trading And The Emotional Boomerang by Adrienne Laris Toghraie Negative boomerang and Mr. Hyde evaluation....

  • The Insync Index by Norm North

    ARTICLE SYNOPSIS ...The Insync Index by Norm North Here's a method to graphically display the signal status for a group of indicators as well as an algorithm for generating a consensus indicator that shows when these indicators are in sync. The methods described can be used with any group of indicators. Using the presignal concept as a base, the algorithm for creating the Insync index, which is a consensus indicator, is simple and obvious - once you see it. It works consistently well, almost always outperforming its component indicators. A user should be able to implement and test it, to some extent using many...

  • Trading And The Emotional Boomerang by Adrienne L. Toghraie

    ARTICLE SYNOPSIS ...rading And The Emotional Boomerang by Adrienne L. Toghraie How are your emotions affecting your trading? They don't, you say? But they do. Even though you may not be aware of it, your emotions are always influencing your trading. Since we are forever in one emotional state or another and since our emotions spread out in all directions like ripples on a pond, they affect everything that stands in their path, including our trading. Inwardly, these emotions affect how you make decisions about your trading, and the results of these decisions will, in turn, produce new emotions and send them back ...







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