I am going to make this short as I just arrived at work...
So STEC didnt work out. I mean, it followed the pattern I thought it would (which is dip low, and then rise up... the optimal pattern for all my picks) , it just didnt dip to my low point before it shot up. Ah well, nothing lost.
As for today, I am set to buy FXEN at 7.66 (or the open, whatever is lower) and sell at 8.81 or mondays close, whichever comes first.
In the next few days I am going to put some more details on my stock trading philosophy as well as a post on creativity (been wanting to write that one for a while.) Until then...
Friday, November 30, 2007
Wednesday, November 28, 2007
How about this weather(market)?
As to methods there may be a million and then some, but principles are few। The man who grasps principles can successfully select his own methods. The man who tries methods, ignoring principles, is sure to have trouble.
-Ralph Waldo Emerson
The stock market can be predicted, just like the weather.
There are innumerable methods used to measure the weather. There are weather balloons, radar, thermometers, barometers, visibility measurements, humidity measurements, etc. All of these tools are very useful and provide information that can then be interpreted in order to produce reasonably accurate predictions. The accuracy of these predictions deteriorate quickly when the forecast length is increased. Thus, the key to producing an accurate weather forecast is knowing the time frame that your data allows you to predict.
The same is true of the market. Everything in the market can be measured. Some measurements are direct such as price and earnings estimates. Others can be measured indirectly such as confidence (insider buying) or popularity (volume). The point is, measurements are taken in the market in a similar fashion to measurements taken of the weather. Along the same lines, the time frame of prediction is of the utmost importance.
Takeaway principles:
Everything that is measurable is predictable. The real question is, "How measurable?"
Chaos is a long-term phenomenon
Using the takeaways above, I developed a spreadsheet that filters stocks using about 100 different criteria. I wrote a formula (with the help of some Excel forum geniuses) that checks to make sure all of the parameters are within my specified range, then uses the stock's average volatility to calculate an entry and exit point for the stock. I have been tweaking the system about 1.25 years, but came up with a my most robust filter in late September 2007. Since then I have beat the market pretty substantially The results of the spreadsheet can be found here
P.S.
I am set to buy STEC @ 8.12 on 11/29/07, and sell it @ 8.91 or Closing Bell 11/30/07, whichever comes first.
-Ralph Waldo Emerson
The stock market can be predicted, just like the weather.
There are innumerable methods used to measure the weather. There are weather balloons, radar, thermometers, barometers, visibility measurements, humidity measurements, etc. All of these tools are very useful and provide information that can then be interpreted in order to produce reasonably accurate predictions. The accuracy of these predictions deteriorate quickly when the forecast length is increased. Thus, the key to producing an accurate weather forecast is knowing the time frame that your data allows you to predict.
The same is true of the market. Everything in the market can be measured. Some measurements are direct such as price and earnings estimates. Others can be measured indirectly such as confidence (insider buying) or popularity (volume). The point is, measurements are taken in the market in a similar fashion to measurements taken of the weather. Along the same lines, the time frame of prediction is of the utmost importance.
Takeaway principles:
Everything that is measurable is predictable. The real question is, "How measurable?"
Chaos is a long-term phenomenon
Using the takeaways above, I developed a spreadsheet that filters stocks using about 100 different criteria. I wrote a formula (with the help of some Excel forum geniuses) that checks to make sure all of the parameters are within my specified range, then uses the stock's average volatility to calculate an entry and exit point for the stock. I have been tweaking the system about 1.25 years, but came up with a my most robust filter in late September 2007. Since then I have beat the market pretty substantially The results of the spreadsheet can be found here
P.S.
I am set to buy STEC @ 8.12 on 11/29/07, and sell it @ 8.91 or Closing Bell 11/30/07, whichever comes first.
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