Index

  • Absolute return, 410
  • Absolute value, 6
  • Account w/distributions, 92
  • Accountability void, 15–16
  • Accumulated/summed term, 6
  • Achelis, Steven, 11
  • Active management, 410
  • Active vs. passive management, 409–412
  • Adaptive trend, 289–292, 333, 394–396
  • Advance/declines, 291–292, 305–306
  • Advances, 446
  • Against the Gods (Bernstein), 12, 62
  • Alpha, 7, 26, 67, 372
    • vs. market, 380
  • Alternatives, 410
  • Amateur hour, 371
  • Ambiguity aversion, 72
  • American Association of Individual Investors survey, 402
  • American Stock Exchange (AMEX), 300
  • Analog charts, 155
  • Analysis vs. reporting, 155
  • Anchoring, 72–73
  • Anderson, Gary, 63
  • Appel, Gerald, 275–276
  • Arbesman, Samuel, 6
  • Arithmetic average, 270
  • Arithmetic mean (AM), 35
  • Arithmetic moving average, 270–271
  • Arithmetic/simple moving average, 7
  • Arrow, Kenneth, 50, 62
  • The Art of Low Risk Investing (Zahorchak), 142
  • Asimov., Isaac, 149
  • Asset allocation, 357
  • Asset class analysis, 2
  • Asset classes, 18, 21, 124
  • Asset commitment tables, 353–354
  • Astute Behavior (Nurock.ed.), 446
  • Availability, 73
  • Average, 50, 88, 244
  • Average drawdown
  • Average return per year, 287
  • Average true range (ATR), 7, 96
  • Average U/D, 173
  • Avg Ex 29, 88, 244
  • “Awed by Equations” (Bialik), 65
  • Azimov, Isaac, 58
  • Batra, Ravi, 59
  • Bear markets, 43, 86–90, 103, 237
    • definition, 1
    • magnitude and duration, 90–92
    • response to, 18
    • stages of, 402
    • and withdrawals, 92–96
  • Beck, Melinda, 55
  • Behavioral biases
    • ambiguity aversion, 72
    • anchoring, 72–73
    • availability, 73
    • calendar effects, 73
    • communal reinforcement, 73
    • confirmation bias, 74
    • disposition effect, 74
    • halo effect, 74–75
    • herding, 75
    • hindsight bias, 75
    • loss aversion/risk aversion, 75
    • overconfidence, 76
    • overreaction, 76
    • prospect theory, 76–77
    • recency, 77
    • representativeness, 77
    • selective thinking, 77
    • self-attribution, 77
    • self-deception, 78
    • status quo bias, 78
    • underreaction, 78
  • Behavioral finance, 7
  • Behavioral investing, 71–72
  • Believable misinformation, 3–6, 15
  • Bell curve, 28
  • Bell curve statistics, 26
  • Belsky, G., 77
  • Benchmark huggers, 409
  • Benchmarking, 372–374
  • Bernstein, Peter, 12, 49, 62, 67, 101
  • Bernstein, William, 401
  • Best period return, 380
  • Beta, 336
    • vs. market, 380
  • Bialik, Carl, 65
  • Bias tracks for investors, 78–79
  • Big board, 300
  • Binary, 278
  • Binary indicator, 277–278
  • Binary measure, 277
  • Black, Fischer, 60
  • Black art, 399
  • Black Monday and Tuesday (October 27–28, 1929), 35
  • Black Monday (October 19, 1987), 28–29, 31, 34–35
  • Bloomberg, 12
  • Breadth
  • Breadth analysis, 445
  • Breadth combination measure, 295–296
  • Breadth data, 394
  • Breadth indicators, 392, 445–446, 453
  • Breadth measure
  • Breadth-based indicators, 291–297
  • Bull markets
  • Buy and hold, 7, 409
  • Buy rules, 350
  • Calendar effects, 73
  • Calendar vs. market myth, 83
  • Callan Period Table of Returns, 24
  • Capital Asset Pricing Model (CAPM), 28, 43
  • Capitalization, 7
  • Cartesian coordinate system, 44
  • Cash flows, 49
  • Caution, 277–278
  • Centers for Disease Control (CDC), 55
  • Chart identification, 160–162
  • Chart School, 154
  • Charting, 399
  • Chicago Board Options Exchange (CBOE), 98
  • Coefficient of determination (R2), 7–8, 44–45, 180
  • Cognitive dissonance, 71, 73
  • Commodity trendiness, 196
  • The Commodities Futures Game (Teweles), 147
  • Communal reinforcement, 73
  • Compound measures, 279–280
  • Compounded annual returns while invested, 287
  • Compounding a wonder, 23–24
  • The Complete Guide to Market Breadth Indicators (Morris), 396, 445
  • Conclusions
  • Confirmation bias, 74
  • Conflating science and advocacy, 64
  • Controversial practices. See Statistics, misuse of
  • Conventional certitudes, 64
  • Copper drawdown, 262–264
  • Coppock, Edwin Sedgwick “Sedge,” 145
  • Core Rotation Strategy (CRS), 344
  • Coriolis Effect, 5
  • Correlation, 8, 18, 338
    • vs. market, 380
  • CPI data, 12
  • Cramer, Jim, 59
  • “Create a Hybrid Indicator” (Ritter), 320
  • Cumulative drawdown, 233–235
  • Cumulative drawdown for S&P, 242
  • Cumulative return, 380
  • Curve fitting, 148
  • CXO Advisory Group LLC, 63
  • Cycles, types of, 104
  • Cyclical events, 156
  • Cyclical market performance, 299–300
  • Da Vinci, Leonardo, 147–148
  • Dahlquist, Julie, 143
  • Daily vs. weekly market breadth, 448
  • Dalbar, 80
  • Dance with Chance (Makridakis), 62
  • Dance with the Trend
  • Dancing with the Trend Model
  • Data, 12–14
  • Data with history prior to 1980, 205
  • Data with history prior to 1990, 205
  • Data with history prior to 2000, 205
  • De Kempenaer, Julius, 122, 124
  • Decile, 135
  • Decline(s), 231, 236, 447
  • Defensive components, 121
  • Defined Contribution, 391
  • Deflation, 104
  • Demand, 159
  • Derman, Emanuel, 60
  • Detrend, 8, 322
  • Discipline, 144, 363
  • Discount rate, 49
  • Discounted cash flow (DCF) model, 49–50
  • Disposition effect, 74
  • Distribution
  • Divergence, 8
  • Divergence indicator, 275
  • Diversification, 43
  • Dobell, Rolf, 68
  • Doctor Copper, 262
  • Doherty, Jud, 391, 397
  • Dollar cost averaging (DCA), 21–23, 410
  • Domestic trendiness, 196
  • Dominant index, 303–305
  • “Don’t Let the Math Pull the Wool Over Your Eyes” (Bialik), 65
  • Dow 36,000 (Glassman and Hassett), 60
  • Dow 40,000 (Elias), 60
  • Dow 100,000 (Kadlec), 60
  • Dow Industrials, 12
  • Dow Jones Industrial Average (DJIA), 86, 251–257, 357
  • Down, 173, 180
  • Down capture, vs. market, 380
  • Down market, 369–370
  • Down spikes, 454
  • Downside risk, 380
  • Downtrending market, 273
  • Drawdown, 344
  • Drawdown analysis, 330
  • Drawdown intensity evaluator (DIE), 264–266
  • Dueling certitudes, 64
  • Dystant, Ralph, 273
  • Early trend measures, 311
  • Earnings season, 66–67
  • Easterling, Ed, 65, 101, 103–104, 110
  • Economic Inquiry, 60
  • Efficiency ratio, 328–330
  • Efficient frontier, 47–48
  • Efficient Market Hypothesis, 43
  • 1885-2012 arithmetic mean, 35
  • Einstein, Albert, 23
  • Elias, David, 60
  • Elliot Wave theory, 150
  • Emotional cycle, 79
  • Emotional discipline, 401
  • Endowment effect, 71, 78
  • Equities, 2
  • Equity market sectors, 2
  • Erf (error function), 32
  • Evening star, 151–152
  • Exchange-traded funds (EFTs), 319, 363
  • Expense ratio, 372
  • Expert Political Judgment (Tetlock), 64
  • Exponential moving average, 8, 271–273
  • Fama, Eugene, 29
  • Farrell, Robert, 401–402
  • Farrell’s 10 rules for investing, 401–402
  • Fat tails, 30–31
  • Fear and greed, 402
  • Feyman, Richard, 60
  • Fibonacci numbers, 150–151
  • Fibonacci ratio, 151
  • Fictions told to investors
    • accountability void, 15–16
    • believable misinformation, 15
    • compounding a wonder, 23–24
    • dollar cost averaging, 21–23
    • hiding behind statistics, 16–17
    • protection through diversification, 18–21
    • relative performance, 24–26
    • remaining invested, 17–18
  • Filtered water, 9
  • Filtered Waves, 163–164
  • Final observations, 406–407
  • Financial advice, 400–401
  • Financial advisors’ value, 67–68
  • Financial theory, flaws in
    • 60/40 myth, 47–49
    • about, 27–28
    • discounted cash flow (DCF) model, 49–50
    • high sigma days, 34–35
    • improper process, 34
    • linear analysis, 44–45
    • linear regression and correlation, 45–47
    • modern portfolio theory and bell curve, 28–31
    • modern portfolio theory assumptions, 28
    • risk and uncertainty, 42–43
    • rolling returns and Gaussian statistics, 35–42
    • standard deviation (sigma) and shortcomings, 31–33
    • volatility and risk, 42–43
  • Fisher, Ken, 141
  • Flash crash of May 6, 2010, 405–406
  • The Flaw of Averages (Savage), 55
  • Forecasting. illusions of
  • Fortune (magazine), 58
  • The Fortunate Sellers (Sherden), 57
  • The Foundation of Statistics (Savage), 55
  • French, Kenneth, 29
  • Full cycle analysis, 374
  • Full moon, 156
  • Fundamental cycles, 104
  • Future Days (Azimov), 58
  • Galaxies, 32
  • Galbraith, John Kenneth, 61–62
  • Gaussian (bell-curve) statistics, 31, 41, 400
  • Gaussian distribution, 29, 32
  • Generational market, 103
  • Geometric mean, 172
  • GICS summary, 223
  • Gilovich, Thomas, 77
  • Global Industry Classification Standard (GICS), 223
  • Goepfert, Jason, 281
  • Gold drawdown, 262
  • Goldberg, J., 76
  • Golden ratio, 150
  • Good ones, 455
  • Goodness of fit, 44
  • Graham, Benjamin, 22–23
  • The Great Depression of 1990 (Batra), 59–60
  • Growth, 50
  • Growth charts, 55–56
  • Growth vs. value component, 301
  • Guidelines, 352
  • Gurus/experts, 63–65
  • Halo effect, 74–75
  • Harmonic mean, 172
  • Hassett, Kevin, 60
  • Haurlan, Pete, 8, 271
  • Head and shoulders top pattern, 151
  • Herding, 75, 146, 230
  • Heuristics, 71
  • Hiding behind statistics, 16–17
  • High sigma days, 34–35
    • 1885-2012 arithmetic mean, 35
    • Black Monday and Tuesday (October 27–28, 1929), 35
    • Black Monday (October 19, 1987), 35
  • High-low validation measure, 454–456
  • Highly volatile periods, 101
  • Hindsight, 57
  • Hindsight bias, 75
  • Hirshleifer, David, 75
  • Hoaxes, 61
  • Humans, 33
  • Humor, 13
  • Hunt brothers, 61, 262
  • Hurst, J. M., 270
  • Hussman, John, 65
  • ICB (Industry Classification Benchmark), 214
  • Improper process, 34
  • in sample data, 284
  • Independent variable, 180
  • Indicators
  • Indicators, uses of
  • Indices, list of, 166–168
  • Indices analysis summary, 189–193
  • Infinity, 33
  • Inflation, changes in, 1
  • Information, actionable vs. observable, 14, 16
  • Initial action items, 352
  • Initial trend measures (ITM), 311–314, 353, 357
  • Intellectual void, 65–66
  • Interest-sensitive securities, 393
  • International trendiness, 196
  • Investing with weight of evidence, 361–363
  • Investment professional’s dilemma, 61–63
  • Investor behavior, 402
  • Investor emotions, 79
  • Investor(s)
  • Investors
  • Investor’s Guide to Fidelity Funds (Martin), 328
  • Issue, 278
  • Jabar, Kareem Abdul, 65
  • January effect, 73
  • The Janus Factor (Anderson), 63
  • Japanese candle patterns, 151–153
  • Japanese Nikkei 225 drawdown, 262–264
  • JdK RS-momentum, 123
  • JdK RS-ratio, 123
  • Kadlec, Charles W., 60
  • Kahneman, Daniel, 73, 75–77
  • Kaufman, Perry, 328
  • Kerviel, Jerome, 61
  • Kinnell, Russell, 80
  • Kirkpatrick, Charlie, 143
  • Kurtosis, 172
  • Lack of discipline, 80
  • Lagging, 446
  • Lane, George, 273
  • Largest trade lost, 287
  • Leading indicators, 68
  • Lee, Adrian
  • Les Miserables (Hugo), 151
  • Lesson, Nick, 61
  • Leverage, 402
  • Linear analysis, 44–45
  • Linear regression and correlation, 45–47
  • Liquidity, 448
  • Little Book of Behavioral Investing (Montier), 72
  • Long Term Capital Management (LTCM), 60–61, 355
  • Long term measure (LTM), 308–309
  • Long-term averages, 50
  • Look-back periods, 39–41
  • Look-forward periods, 39–40
  • Loss aversion, 75, 78
  • Loss avoidance, 394
  • Loss of capital, 43
  • Loss protection (stop loss), 24
  • Lost decade, 125–128
  • Ockham, William of, 355
  • Offensive components, 121
  • Optimism, 283
  • Option Pricing Theory, 43
  • Oscillators, 9
  • Out of sample, 284
  • Overbought/oversold, 9
  • Overbought/oversold indicator, 273, 277
  • Overconfidence, 76
  • Overlay, 9
  • Overreaction, 76
  • Oversold, 162
  • Pacioli, Luca, 148
  • Pair analysis, 342–346
  • Parameter, 287
  • Paretian curve, 31
  • Paretian distributions, 30
  • Pascal, Blaise, 13
  • Passive management, 409–410
  • Peak, 9
  • Percent Participation Index, 296
  • Percentage, 9–10, 135
  • Percentage of time invested, 287
  • The Physics of Wall Street (Weatherall), 29
  • Pinnacle Data, 12
  • Plateaus, 283
  • “Policy Analysis with Incredible Certitude” (Manski), 64
  • Polls and surveys, 155–156
  • Popper, Karl, 62
  • Power laws, 400
  • Power score, 327–328
  • Prechter, Robert, 400
  • Predictor variable, 180
  • Price
  • Price behavior, 163
  • Price component, 306
  • Price dispersion, 101–102
  • Price earnings (PE) data, 12
  • Price earnings (PE) ratio, 1, 103
  • Price momentum, 324
  • Price performance, 324–325
  • Price-based indicators
  • Pring, Martin, 106–107, 143
  • Probability, 15
  • Probable Outcomes (Easterling), 103
  • The Professional Tape Reader (Weinstein), 281
  • The Profit Magic of Stock Transaction Timing (Hurst), 270
  • Prospect theory, 76–77
  • Protection through diversification, 18–21
  • Pseudoscientists, 62
  • Pullback rally analysis, 339–342
  • Quartile, 135
  • Quotes, 13
  • Tactical asset management, 410
  • Tactical unrestrained management, 373
  • Tails wagging the dog, 29–31
  • Taleb, Nassim, 60, 75
  • Technical analysis
  • Technical Analysis from A to Z (Achelis), 11
  • Technical Analysis (Kirkpatrick and Dahlquist), 143
  • Technical cycles, 104
  • Technical indicators, 147–148
  • “10 Stocks to Last the Decade” (Rynecki), 58
  • Tetlock, Philip, 64
  • Teweles, Richard, 147
  • Thaler, Richard, 7, 74, 78
  • the curb, 300
  • The Guardian, 68
  • “The Red Coats” case, 55
  • 30-minute window, 372
  • Thomson Reuters, 12
  • Thurow, Lester, 60
  • Tie-breaker measures, 346
  • Time series that does not trade, 153
  • Total issues, 447
  • Total volume, 447
  • Tracking error, 26, 67, 372
  • Trade up rules, 351–352
  • Trades per year, 287
  • Trading Lesson 16 (Jabar), 65
  • Trading rules, 371–372
  • Trailing stops, 326
  • Trend, 320
  • Trend analysis
    • about, 163–173
    • all trendiness analysis, 184
    • in secular bear markets, 230
    • trend table selective analysis, 184–189
    • trendiness one rank and trendless rank comparison, 180–184
    • trendlines determination method one, 172–173
    • trendlines determination method two, 173–176
    • trendlines methods compared, 176–180
  • Trend analysis on S&P GICS Data, 193–198
  • Trend capturing compound measure, 306–308
  • Trend capturing measure, 305–308
    • advance decline component, 305
    • price component, 306
    • trend capturing compound measure, 306–308
    • up volume/down volume component, 306
  • Trend continuation, 162
  • Trend diffusion, 322–325
  • Trend following, 162
    • breadth measure model, 393
    • with momentum, 392
  • Trend gauge, 314–317
  • Trend price performance, 363
  • Trend rate of change (ROC), 321–322
  • Trend stop, 371
  • Trend strength, 315–317
  • Trend table selective analysis, 184–189
  • Trend vs. mean reversion, 162–163
  • Trend-following interview, 386–397
  • Trendiness
  • Trendless analysis, 180
  • Trendlines, 11
  • Treynor ratio, 336
  • Trimmed mean (20 percent), 172
  • Trough, 11. See also Peak
  • Turnover and taxes, 373
  • Tvesky, Amos, 73, 75–77
  • Twain, Mark, 1
  • Tweaking the model, 364–365
  • 20/20 hindsight, 163
  • U/D ratio, 171
  • Ulcer index, 287, 334, 344, 377, 394
  • Unconstrained tactical models, 373
  • Underreaction, 78
  • Understanding the past, 84
  • Unexpected Returns (Easterling), 103
  • Unweighted index (ZUPI), 342
  • Up, 173, 180
  • Up and down capture, 368
  • Up capture, vs. market, 380
  • Up market, 369
  • Up rank, 173
  • Up spikes, 454
  • Up volume/down volume, 292–294, 447
  • Up volume/down volume component, 306
  • Upside volatility, 41
  • Uptrendiness Wtd/Avg., 173
  • Uptrending market, 273
  • Wald, Abraham, 400
  • Wall Street Journal, 22, 55, 65
  • Wall Street Week, 146, 446
  • Washington, George, 4
  • Watch Investors Intelligence, 402
  • Watching tactical strategy over short term, 373
  • Weatherall, James, 29
  • Weekend effect, 73
  • Weems, Mason Locke, 4
  • Weight of the evidence (WoEv), 173, 281–283, 353–354, 356–361
  • Weighted parameters, 333–334
  • Weinstein, Stan, 281
  • Whipsaws, 273, 386
  • Wilder, Welles, 274
  • Wilkinson Microwave Anistropy, 33
  • Williams, Larry, 64–65
  • Winning on Wall Street (Zweig), 344
  • Winning years, 287
  • Wishful extrapolation, 64
  • Withdrawals, 92–96
  • Wolfram Alpha, 32–33
  • Wong, Ted, 29, 314
  • World market climate, 299
  • World of finance, 11, 27, 373
  • Worst period return, 380
  • Zahorchak, Michael, 142
  • Zeckhauser, R., 78
  • Zweig, Jason, 22, 49
  • Zweig, Martin, 342, 344
..................Content has been hidden....................

You can't read the all page of ebook, please click here login for view all page.
Reset