From: Dossy (dossy@panoptic.com)
Date: Fri Jun 13 2003 - 05:07:28 MDT
I'm surprised that I haven't seen the real truth about the market and
trading strategy exposed yet ... let me throw it out there ...
Playing the market is pretty straightforward. Forget all that fancy
schmancy analysis and clever algorithmic prediction nonsense. As gts
says, trading systems that claim to validate themselves on hindsight are
cute, but are still 50/50 chances (or worse for you) on making money.
The market is driven by the simplest of principle -- supply and demand.
The supply is known and limited ... so demand is what sets the price.
So, how do you profit in the market? Try to guess where the demand is
going to be. What's great is in order to profit, you don't have to be
the /first/ to know where the demand is headed. You just have to not be
the /last/ one to find out where it went.
Now, all those analysts will tell you that the hard work and brainpower
expended in analysis is all about determining where the demand is
headed. Fact of the matter is, the market is a beauty pageant. It's
subjective, because demand is the result of the subjective choices of
some key players. In other words: the most beautiful girl at the
pageant isn't necessarily the most beautiful. She's just the one that
all the /judges/ agree is the most beautiful by the way they voted.
So, IMHO, a good strategy is to try and identify at the current time who
the "judges" in the market are, try to understand their strategy
(irrelevant of if you think their strategy is good or bad) and try and
simply predict where they're headed. Or, don't even do that much:
simply watch them and follow them and hope you're not the last one in
line, and you should profit -- the earlier you get in line, the more
you'll profit.
-- Dossy
-- Dossy Shiobara mail: dossy@panoptic.com Panoptic Computer Network web: http://www.panoptic.com/ "He realized the fastest way to change is to laugh at your own folly -- then you can let go and quickly move on." (p. 70)
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